(Yicai Global) April 9 -- Sucker punched by the Covid-19 pandemic, Chinese online travel platform Tuniu’s first quarter revenue is projected to have crumpled 65 percent to 75 percent on the year to CNY110 million (USD15.5 million) to CNY160 million, according to the annual report the company released yesterday.
Tuniu's revenue was CNY2.3 billion (USD27.6 million) last year, up 1.8 percent from a year earlier. Weighted down by heavier operating expenses, its net loss attributable to common shareholders grew by almost 272 percent to CNY699.2 million in the period. The coronavirus outbreak has pummeled the firm's business since January.
Its shares [NASDAQ:Tour] closed 2.78% down at 0.90 US cents yesterday.
“The current circumstances are dynamic and the impact of COVID-19 on our business operations cannot be reasonably estimated at this time, and we anticipate this will have material adverse impact on our business, financial position, results of operations and cash flows in 2020,” Tuniu said in the report.
“Although we expect short-term turbulence within the industry, we remain confident that the economy and travel industry of China will be able to gradually recover as the COVID-19 has been largely contained within China,” said Tuniu founder, Chairman and Chief Executive Officer Donald Yu, adding, “On the business operation side, we are focusing on developing high-quality products and services for our customers in anticipation of an increase in demand for domestic travel. We believe Tuniu will be well-positioned to better capture market opportunities when the travel industry begins to recover."
"Since the fourth quarter of 2019, we have been making various adjustments to our business operation and corporate structure,”said Maria Xin, Tuniu's chief financial officer. “After the outbreak of the COVID-19, we have implemented a number of cost-saving adjustments that will manifest starting from the second half of 2020,” she continued.
“Due to the COVID-19 outbreak in early 2020, the Chinese government has announced bans prohibiting the sale of packaged tour products. As China's leading online leisure travel company, we have a high social responsibility and will continue prioritizing the safety of our customers," she added.
The Nanjing-based firm also announced a staff shakeup after the report’s release, saying Xin will step down from May 31 for personal reasons.
Editor: Ben Armour