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Min, James and Jane will provide a business update, industry outlook and the financial highlights for the first quarter of 2012, as well as the outlook for the second quarter of 2012. We will also have a Q&A session toward the end of this call.With that I will turn to Min for our business update. Min Fan Thanks, Lin, and thank you to everyone for joining us on the call today. Through solid execution on our business strategies, the Ctrip team has continued outperforming the industry in the first quarter of 2012. Our net revenues grew by 90% year over year, in the high end of our guidance of 15% to 20% year-over-year growth. And net income decreased by 28% year over year. We strengthened core business sectors, expanded into more new business areas, and intensified sales and marketing campaigns. We’ve further expanded our hotel supply network which cover about 30,900 domestic hotels as of the first quarter of 2012, compared with 18,000 hotels a year ago. The number of hotels with guaranteed room allotment accounted for about 70% of the total hotel supply. Our hotel reservation e-coupon program has received positive user feedback, helped us attract more lead customers and further strengthened our leading position in the hotel reservation sector. We will continue to closely monitor the development of competition and adjust our strategies accordingly. As part of our innovative product offering efforts, we upgraded the Smart Choice Hotels platform in the first quarter. Compared with other discount hotel booking models, the Smart Choice Hotels are more suitable to Chinese customers. The transparent pricing information model makes it easy for customers to find a great deal that meets their expectations. The Smart Choice Hotel product has been growing healthily since its launch, covering about 2,000 hotels already. With more hotels to join the network, we expect to see its increasing popularity among leisure travelers.
[Fujia.com] is another new initiative to explore the opportunities in the leisure accommodation market. It is a vacation rental business that offers customers a great choice of accommodations, with more flexibility and lower cost than traditional hotel. [Fujia.com] targets leisure customers traveling with families and friends. We believe the vacation rental business offers a brand-new travel experience for Chinese travels, and [fujia.com] has the expertise and technology to lead growth in China for this new segment.In order to offer full range of hotel accommodations, different travel needs, Ctrip invested in [sungko.com], and hostel booking aggregate site. [Sungko.com] provides a high quality online booking service for the fragmented hostel market, with more than 5,000 hostel listings, including smaller budget hotel chains, [boutique] hotels and hostels in historic and scenic sites. As an independent brand, [sungko.com] targets the young generation who want adventure but have limited spending power. We believe [sungko.com] will help Ctrip further penetrate a younger demographic. To accommodate fast-growing demand for international travel, we upgraded our international air ticketing channel in the first quarter. The upgrade channel provides users with more online searching and booking options, including complex multi-destination tickets. It also offers intelligent filter to help customers find the most suitable flight. In addition, it provides for the most transparent and competitive prices. This upgrade of international ticketing platform is a revolutionary breakthrough in the international air ticketing market. We believe it will help us extend our leadership into international air ticketing. Ctrip’s package tour business delivered another strong quarter with revenue from Mainland China to grow 51% year over year. The high-end travel is growing fast in China. The Chinese Luxury Consumer White Paper 2012, jointly published by the industry bank and (inaudible) indicates that there are nearly 3 million Chinese people who own over RMB6 million of personal assets.
To capture this rising demand of high-end travels, in March Ctrip launched HHTravel.com a new travel brand primarily looking at high-end travelers of (inaudible) China with a personalized super-deluxe tour. We successfully tested high-end market with our [global deluxe tour] three years in a row and results overwhelmingly beat the industry’s expectation. Our 80-day group tours which cost over RMB1 million per person was sold out within 17 seconds in March.Read the rest of this transcript for free on seekingalpha.com