On May 21, Tong Cheng Yilong announced the first quarter of 2020 results announcement. The announcement showed that Tongcheng Yilong achieved revenue of 1.005 billion yuan in the first quarter, and its adjusted net profit was still positive, reaching 78.08 million yuan, with an adjusted net profit rate of 7.8%. In the first quarter of 2020, revenue decreased by 43.6% year-on-year to 1.005 billion yuan, and transaction volume (GMV) decreased by 49.3% year-on-year to 18.2 billion yuan from 35.9 billion yuan in the same period last year.

On the 22nd, Tong Cheng Yilong CEO Ma Heping and CFO Fan Lei interpreted the company's first quarter financial report.

The company's revenue declined in the first quarter, but remained profitable

The financial report for the first quarter showed that the adjusted net profit of Chengyilong in the first quarter was 78 million yuan, a decrease of 82.6% compared with 449 million yuan in the same period of 2019. In the first quarter of 2020, revenue decreased by 43.6% year-on-year to 1.005 billion yuan, but the adjusted net profit was still positive, reaching 78.08 million yuan. In terms of specific business segments, income from accommodation booking services and transportation ticketing services have been affected to varying degrees. However, other revenues such as advertising services and supporting value-added user services have increased substantially, from 35.3 million yuan in the first quarter of 2019 to 89.33 million yuan, a 153.1% year-on-year increase.

In this regard, Fan Lei said that the company stopped marketing earlier and made various adjustments to the cost structure. During the epidemic, Tongcheng Yilong's revenue fell by 40%, but the cost of sales fell by 30%, and market expenses fell by nearly 40%, making it still profitable in the first quarter.

In terms of user growth, with the improvement of the domestic epidemic situation, the search volume of the user's long-term itinerary continued to rise, which helped promote the rapid recovery of the user scale of Tongyi Long. The announcement shows that in the first quarter of 2020, MAU (average monthly active users) has rebounded to 148 million, while MPU (average monthly paying users) has reached 14.8 million. Fan Lei said that the recovery of monthly users indicates that tourism demand still exists, and users are currently in the state of “grass planting” and long-term planning.

In addition, Fan Lei also mentioned that during the epidemic, the company conducted internal training, such as taking inventory of organizational capabilities and adjusting the structure of talents. At the same time, the intelligent connection of the front and back ends also reduced costs and improved efficiency.

The data in the second quarter showed an upward trend. Expected explosive growth at the end of the year

Ma Heping said that from the current data, domestic tourism will have an explosive growth at the end of the year.

Data from April and May showed that the overall recovery of Cheng Yilong was faster, but Ma Heping said that it was about 10 percentage points slower than the management expected. "We expect domestic tourism to have explosive growth at the end of the year, but the recovery of overseas tourism is expected to be pessimistic."

Fan Lei said that the current data for the second quarter has shown a rebound trend. The growth of overnight stays in May basically returned to the same level as in previous years, with air tickets returning to the 80% -85% level, a qualitative leap compared to April. The data shows that "5 · 20" is a peak period for domestic hotel reservations. Compared with the same period last year, Tongcheng Yilong's accommodation has increased by 21%, of which the accommodation orders of low-tier cities have increased by 36%.

"We remain optimistic about the performance of the next stage, and profit margins in the third and fourth quarters may increase," Fan Lei said. In addition, Fan Lei said that April 29 is a time node, and the downgrade of Beijing's prevention and control level has also brought a recovery of domestic travel and leisure travel.

In the future, it will lay a sink in the market and find new support for traffic

With the gradual saturation of the first- and second-tier city markets, how to obtain customers and traffic in the sinking market has become a problem to be considered by the OTA platform. In 2019, Ctrip's second- and third-tier markets contributed more than 60% of new users; Meituan relied on the accumulation of low-end hotel resources to occupy 47.30% of the market. About 85.7% of the registered users of Tongcheng live in non-first-tier cities in China. In the first quarter of this year, about 56.1% of the newly registered users were from third-tier cities or below.

Thanks to the cooperation with Tencent, Tong Cheng Yilong has a relatively stable customer entrance in low-tier cities. "Of all channels, our traffic on Tencent's platform is the most cost-effective and relatively stable during the epidemic." Tong Cheng Yilong said that in the first quarter of 2020, about 82.5% of the average monthly active users came from Tencent's platform, mainly From the WeChat wallet and the small program drop-down list (the monthly activity brought by the portal is 102 million person-times), interactive advertisements placed on Tencent's platform, sharing and search functions in WeChat.

Ma Heping said that in the future, the company will put all its operational capabilities into the low-tier city market to promote the high growth of low-tier city hotels, and at the same time, it will also empower the low-tier city's back-end supply chain to help it improve the "+ Internet" The ability to apply.

At the same time, Tongcheng Yilong is currently looking for new traffic channel support. In March, we cooperated with Cheng Yilong and Kuaishou. Kuaishou will provide tens of millions of traffic support and high-quality talent resources. In addition to providing tourism products, Tong Cheng Yilong will also launch a series of short videos and live broadcast activities with major tourist destinations. In the future, the two parties will also conduct in-depth cooperation on content marketing, scene marketing, live short video and other aspects. In this regard, Ma Heping said that the company hopes to have more attempts on new traffic channels in the future, such as Douyin, Kuaishou, Weibo, Xiaohongshu and Station B, etc., which are under negotiation and hope that it can become an incremental space .

According to reports, Tongcheng Yilong will make efforts in four aspects in the future, including brand loyalty improvement, hotel growth to become the industry leader, dig deeper into the market share of low-tier cities, and empower the back-end supply chain to help enhance it. " + Internet ", the use of small programs and the ability of members to manage direct sales, etc.

Ma Heping believes that the epidemic has also brought opportunities to the tourism industry. The increase in the online rate, the increase in the chain rate and the onlineization of the back-end traditional industries will bring new changes to the industry.