Home Inns posts shrinking 2007 net profit

Home Inns and Hotels Management Inc, China's top budget hotel chain, posted that its net profit for 2007 down from RMB 48.9 million to RMB 35.8 million in its unaudited annual financial report.

In its annual report, it ascribed the decline to the acquisition of Top Star hotel China and the foreign exchange losses of RMB 53.2 million. Last year, Home Inns paid RMB 340 million for 100% equity interest in Top Star, which runs 25 hotels in China.

Its 2007 revenue surged 68.1% year-on-year to RMB 989.5 million after it posted the net loss of RMB 15.2 million in the Q4 2007, which included RMB 4.6 million for share-based compensation, RMB 24.1 million for foreign exchange losses and RMB 13.2 million related to the purchase of the Top Star.

In the report, it forecasted its revenue would reach RMB 330-350 million in the Q1 2008, while the revenue for the whole year 2008 would soar 70-80% year-on-year.