UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of August 2012
Commission File Number: 001-34862
SOUFUN HOLDINGS LIMITED
(Exact name of registrant as specified in its charter)
8/F, T3 Xihuan Plaza, 1 Xizhimenwai Avenue, Xicheng District,
Beijing 100044, the People’s Republic of China
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
Unless we otherwise specify, when used in this Form 6-K the terms “SouFun,” the “Company,” “we” and “our” refer to SouFun Holdings Limited and its subsidiaries and consolidated controlled entities.
This Form 6-K contains our unaudited financial results as of and for the three months ended June 30, 2012 and a discussion of these results which we previously publicly released on August 16, 2012.
This Form 6-K, excluding Exhibit 99.1, is hereby incorporated by reference into our Registration Statement on Form F-3 (Registration No. 333-181407).
Grant of Options to Executive Officers
On August 15, 2012, the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of the Company granted options to certain executive officers, including Vincent Tianquan Mo (“Mr. Mo”), Executive Chairman of the Board, Richard Jiangong Dai (“Mr. Dai”), President, Chief Executive Officer and a director of the Company, Lanying Guan, Chief Financial Officer of the Company, and Jian Liu, Chief Operations Officer of the Company, pursuant to the Company’s 2010 Stock Incentive Plan. The Committee consists of two independent directors and Mr. Mo, who is not independent. Mr. Mo does not participate in the decisions or approval of his compensation, including any stock option grants, and abstained from the vote to approve his option grant on August 15, 2012.
The following table sets forth certain information regarding the options granted to these executive officers on August 15, 2012.
| Number of Class A ordinary shares to be issued upon exercise of options |
Exercise price per ordinary share (US$) |
Date of grant | Date of expiration |
|||||||||||||
| Media Partner Technology Limited / Mr. Mo(1) |
75,000 | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||
| Next Decade Investments Limited / Mr. Mo(1) |
75,000 | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||
| Mr. Dai |
40,000 | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||
| Lanying Guan |
40,000 | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||
| Jian Liu |
40,000 | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||
| (1) | Represents options granted to Mr. Mo in his capacity as executive chairman. These options were assigned and allocated to Media Partner Technology Limited (“Media Partner”) and Next Decade Investments Limited (“Next Decade”), whose shares are held in an irrevocable discretionary trust established by Mr. Mo. |
The options will vest over a four-year period. Specifically, with respect to the options granted to each of the executive officers, 20% of the shares subject to the options will vest on August 15, 2013, 20% of the shares subject to the options will vest on August 15, 2014, 30% of the shares subject to the options will vest on August 15, 2015 and 30% of the shares subject to the options will vest on August 15, 2016, subject to such executive officer providing continuous service through each such date.
The exercise price of the options was $12.80, which was the same exercise price for the grant of options to acquire a total of 1,810,700 Class A ordinary shares to 904 employees of the Company on July 26, 2012, based on the closing price of the Company’s American depositary shares on July 25, 2012. Such options were approved on that date by Mr. Mo as the sole member of the Stock Option Committee of the Board with the authority under the 2010 Stock Incentive Plan to determine stock option grants to any non-officer employees of the Company. The grant of stock options to Mr. Mo and the other executive officers required the approval of the Compensation Committee and therefore that decision was deferred until the next regular board meeting on August 15, 2012, at which the Compensation Committee held a meeting. The Compensation Committee determined that it was in the best interests of the shareholders that Mr. Mo and the other executive officers receive the same exercise price that was provided to the other employees. The Committee noted that the options provide a long term incentive by vesting over a four-year period. The Company will record a compensation expense amortized over the options’ vesting period of a total of $1.33 million, representing the fair market value of such options.
The following table summarizes, as of August 15, 2012, the outstanding options that we had granted to our current directors and executive officers.
| Number of Class A ordinary shares to be issued upon exercise of options |
Number of Class B ordinary shares to be issued upon exercise of options |
Exercise price per ordinary share (US$) |
Date of grant | Date of expiration | ||||||||||||||||
| Mr. Mo(1) |
225,000 | — | 5.00 | December 31, 2006 | December 30, 2016 | |||||||||||||||
| 225,000 | — | 5.00 | December 31, 2007 | December 30, 2017 | ||||||||||||||||
| 225,000 | — | 5.00 | December 31, 2008 | December 30, 2018 | ||||||||||||||||
| 225,000 | — | 10.00 | December 31, 2009 | December 30, 2019 | ||||||||||||||||
| Media Partner / Mr. Mo(1) |
500,000 | — | 10.625 | September 17, 2010 | September 16, 2020 | |||||||||||||||
| 75,000 | — | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||||||
| Next Decade / Mr. Mo(1) |
— | 1,754,500 | 5.00 | September 30, 2006 | September 29, 2021 | |||||||||||||||
| 500,000 | — | 10.625 | September 17, 2010 | September 16, 2020 | ||||||||||||||||
| 75,000 | — | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||||||
| Mr. Dai |
40,000 | — | 4.06 | September 1, 1999 | August 31,2014 | |||||||||||||||
| 10,000 | — | 5.00 | December 31, 2007 | December 30, 2017 | ||||||||||||||||
| 18,750 | — | 5.00 | December 31, 2008 | December 30, 2018 | ||||||||||||||||
| 18,750 | — | 10.00 | December 31, 2009 | December 30, 2019 | ||||||||||||||||
| 75,000 | — | 10.625 | September 17, 2010 | September 16, 2020 | ||||||||||||||||
| 40,000 | — | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||||||
| Shan Li |
* | — | 5.00 | December 31, 2007 | December 30, 2017 | |||||||||||||||
| * | — | 5.00 | December 31, 2008 | December 30, 2018 | ||||||||||||||||
| * | — | 10.00 | December 31, 2009 | December 30, 2019 | ||||||||||||||||
| Quan Zhou |
— | * | 1.97 | April 28, 2004 | April 27, 2019 | |||||||||||||||
| * | — | 5.00 | December 31, 2006 | December 30, 2016 | ||||||||||||||||
| * | — | 5.00 | December 31, 2007 | December 30, 2017 | ||||||||||||||||
| * | — | 5.00 | December 31, 2008 | December 30, 2018 | ||||||||||||||||
| * | — | 10.00 | December 31, 2009 | December 30, 2019 | ||||||||||||||||
| Lanying Guan |
* | — | 5.00 | December 31, 2006 | September 30, 2016 | |||||||||||||||
| * | — | 5.00 | December 31, 2007 | December 30, 2016 | ||||||||||||||||
| * | — | 5.00 | December 31, 2008 | December 30, 2017 | ||||||||||||||||
| * | — | 10.00 | December 31, 2009 | December 30, 2018 | ||||||||||||||||
| * | — | 10.625 | September 17, 2010 | September 16, 2020 | ||||||||||||||||
| * | — | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||||||
| Jian Liu |
* | — | 5.00 | December 31, 2006 | December 30, 2016 | |||||||||||||||
| * | — | 5.00 | December 31, 2007 | December 30, 2017 | ||||||||||||||||
| * | — | 5.00 | December 31, 2008 | December 30, 2018 | ||||||||||||||||
| * | — | 10.00 | December 31, 2009 | December 30, 2019 | ||||||||||||||||
| * | — | 10.625 | September 17, 2010 | September 16, 2020 | ||||||||||||||||
| * | — | 12.80 | August 15, 2012 | August 14, 2022 | ||||||||||||||||
| * | Upon exercise of all options granted, would beneficially own less than 1.0% of our outstanding ordinary shares. |
| (1) | Represents options granted to Mr. Mo in his capacity as our executive chairman, which were assigned and allocated to Media Partner and Next Decade, whose shares are held in an irrevocable discretionary trust established by Mr. Mo. |
Second Quarter 2012 Results
SouFun reported total revenues of US$97.0 million for the second quarter of 2012, representing an increase of 20.4% from the corresponding period in 2011.
Revenue from marketing services was US$55.7 million for the second quarter of 2012, a slight decrease of 2.9% from the corresponding period in 2011, due primarily to an offset by the rapid growth of SouFun’s e-commerce services which has been mainly tested in Beijing and Shanghai.
Revenue from listing services was US$15.5 million for the second quarter of 2012, a decrease of 11.9% from the corresponding period in 2011, due primarily to the challenging environment in the resale market.
Revenue from e-commerce services was US$24.4 million for the second quarter of 2012, a substantial increase from US$4.6 million for the same period in 2011. The increase came mainly from our innovative SouFun card membership services. We began offering paid SouFun card membership services to property buyers to facilitate their transactions with property developers since the second quarter of 2011.
Revenue from other value-added services and products was US$1.4 million for the second quarter of 2012, an increase of 32.6% from the corresponding period in 2011.
Cost of revenue was US$18.2 million, an increase of 15.2% from the corresponding period in 2011. The increase is primarily due to increased staff cost and business taxes associated with the increase in revenues.
Gross margin was 81.2%, compared with 80.4% for the corresponding period in 2011.
Operating expenses were US$31.8 million, an increase of 14.2% from the corresponding period in 2011.
Selling expenses were US$17.1 million, an increase of 16.7% from the corresponding period in 2011, due primarily to increased staff cost.
General and administrative expenses were US$14.7 million, an increase of 11.5% from the corresponding period in 2011, due primarily to increased staff cost.
Operating Income was US$47.0 million, an increase of 27.3% from the corresponding period in 2011.
Income tax expense was US$17.6 million, an increase of 8.0% compared to US$16.3 million for the corresponding period in 2011.
Net income attributable to shareholders was US$32.3 million, an increase of 41.1% from the corresponding period in 2011. Earnings per fully diluted share was US$0.40, compared with US$0.27 for the corresponding period in 2011.
As of June 30, 2012, SouFun had cash, cash equivalents, and short-term investments (excluding the effect from available-for-sale securities) of US$190.6 million, compared to US$158.3 million as of December 31, 2011. Cash flow from operating activities was US$43.9 million for the second quarter of 2012, compared to US$33.9 million for the same period of 2011.
SouFun Holdings Limited
Unaudited Condensed Consolidated Balance Sheets
( in U.S. dollars in thousands )
| June 30, 2012 |
December 31, 2011 |
|||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
157,439 | 150,414 | ||||||
| Restricted cash, current |
35,678 | 35,814 | ||||||
| Short-term investments |
34,345 | 8,592 | ||||||
| Accounts receivable, net |
40,311 | 27,697 | ||||||
| Prepayment and other current assets |
15,717 | 9,695 | ||||||
| Loan receivable |
— | 26,143 | ||||||
| Amounts due from related parties |
1,397 | 1,595 | ||||||
| Deferred tax assets, current |
869 | 1,602 | ||||||
| Total current assets |
285,756 | 261,552 | ||||||
| Non-current assets: |
||||||||
| Property and equipment, net |
80,318 | 68,064 | ||||||
| Restricted cash, non-current portion |
261,926 | 247,631 | ||||||
| Deferred tax assets, non current |
858 | 1,407 | ||||||
| Other non-current assets |
1,797 | 1,717 | ||||||
| Total non-current assets |
344,899 | 318,819 | ||||||
| Total assets |
630,655 | 580,371 | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Short-term loans |
270,570 | 255,570 | ||||||
| Deferred revenue |
91,834 | 73,620 | ||||||
| Accrued expenses and other liabilities |
71,271 | 52,490 | ||||||
| Dividend payable |
— | 51,969 | ||||||
| Income tax payable |
8,012 | 16,158 | ||||||
| Total current liabilities |
441,687 | 449,807 | ||||||
| Non-current liabilities: |
||||||||
| Deferred tax liabilities, non-current |
44,763 | 38,581 | ||||||
| Total non-current liabilities |
44,763 | 38,581 | ||||||
| Total Liabilities |
486,450 | 488,388 | ||||||
| Shareholders’ equity: |
||||||||
| Class A and Class B Ordinary shares (par value of HK$1 per share: 600,000,000 shares authorized; 78,150,568 (Class A-53,813,918 and Class B-24,336,650 ) with par value of US$10,032 (Class A-US$6,908 and Class B-US$3,124) and 78,967,883 (Class A-54,631,233 and Class B 24,336,650 ) with par value of US$10,137 (Class A-US$7,013 and Class B-US$3,124) shares issued and outstanding as of December 31, 2011 and June 30, 2012) |
10,137 | 10,032 | ||||||
| Additional paid-in capital |
56,259 | 49,838 | ||||||
| Accumulated other comprehensive income |
20,750 | 21,853 | ||||||
| Retained earnings |
57,059 | 10,185 | ||||||
| Total SouFun Holdings Limited shareholders’ equity |
144,205 | 91,908 | ||||||
| Noncontrolling interests |
— | 75 | ||||||
| Total shareholders’ equity |
144,205 | 91,983 | ||||||
| TOTAL LIABILITIES AND SHAREHOLDER’S EQUITY |
630,655 | 580,371 | ||||||
SouFun Holdings Limited
Unaudited Condensed Consolidated Statements of Operations
( in U.S. dollars in thousands, except share data and per ADS data )
| Three months ended | Six months ended | |||||||||||||||
| June 30, 2012 | June 30, 2011 | June 30, 2012 | June 30, 2011 | |||||||||||||
| Revenues: |
||||||||||||||||
| Marketing services |
$ | 55,658 | $ | 57,301 | $ | 89,910 | $ | 85,491 | ||||||||
| Listing services |
15,535 | 17,635 | 26,469 | 28,912 | ||||||||||||
| E-commerce services |
24,417 | 4,581 | 36,462 | 4,676 | ||||||||||||
| Other value-added services |
1,378 | 1,039 | 2,637 | 2,266 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total revenues |
96,988 | 80,556 | 155,478 | 121,345 | ||||||||||||
| Cost of Revenues: |
||||||||||||||||
| Cost of services |
(18,208 | ) | (15,802 | ) | (34,730 | ) | (29,020 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total Cost of Revenues |
(18,208 | ) | (15,802 | ) | (34,730 | ) | (29,020 | ) | ||||||||
| Gross Profit |
78,780 | 64,754 | 120,748 | 92,325 | ||||||||||||
| Operating expenses: |
||||||||||||||||
| Selling expenses |
(17,136 | ) | (14,689 | ) | (31,594 | ) | (26,876 | ) | ||||||||
| General and administrative expenses |
(14,655 | ) | (13,149 | ) | (28,478 | ) | (22,615 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total Operating Expenses |
(31,791 | ) | (27,838 | ) | (60,072 | ) | (49,491 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Operating Income |
46,989 | 36,916 | 60,676 | 42,834 | ||||||||||||
| Foreign exchange gain (loss) |
57 | (26 | ) | 55 | — | |||||||||||
| Interest income |
4,529 | 2,178 | 8,956 | 3,555 | ||||||||||||
| Interest expense |
(2,076 | ) | (285 | ) | (4,169 | ) | (327 | ) | ||||||||
| Realized gain-trading securities |
— | 151 | — | 206 | ||||||||||||
| Government grants |
486 | 311 | 923 | 810 | ||||||||||||
| Other-than-temporary impairment on available-for-sale securities |
— | — | (14 | ) | — | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income before income taxes and noncontrolling interests |
49,985 | 39,245 | 66,427 | 47,078 | ||||||||||||
| Income tax expenses |
||||||||||||||||
| Income tax expense |
(17,645 | ) | (16,331 | ) | (19,553 | ) | (18,422 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income |
32,340 | 22,914 | 46,874 | 28,656 | ||||||||||||
| Net income attributable to noncontrolling interests |
— | 8 | — | 13 | ||||||||||||
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|
|
|
|
|
|
|
|||||||||
| Net income attributable to SouFun Holdings Limited shareholders |
$ | 32,340 | $ | 22,922 | $ | 46,874 | $ | 28,669 | ||||||||
| Other comprehensive income, net of tax |
||||||||||||||||
| Foreign currency translation |
(1,242 | ) | (356 | ) | (1,103 | ) | 1,957 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total other comprehensive income, net of tax |
(1,242 | ) | (356 | ) | (1,103 | ) | 1,957 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Comprehensive income |
31,098 | 22,566 | 45,771 | 30,626 | ||||||||||||
|
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|
|
|
|
|
|
|||||||||
| Earnings per share for Class A and Class B ordinary shares |
||||||||||||||||
| Basic |
$ | 0.42 | 0.30 | 0.61 | 0.38 | |||||||||||
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|
|
|
|
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|
|||||||||
| Diluted |
$ | 0.40 | 0.27 | 0.58 | 0.34 | |||||||||||
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|
|||||||||
| Weighted average number of Class A and Class B ordinary shares outstanding: |
||||||||||||||||
| Basic |
76,878,518 | 76,324,682 | 77,241,192 | 76,195,218 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Diluted |
81,392,881 | 83,604,880 | 81,328,134 | 83,335,199 | ||||||||||||
|
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|
|
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Dividend Plan
On August 16, 2012, the Board approved a cash dividend of US$1.00 per share on the Company’s ordinary shares. Each of SouFun’s American depositary shares represents one ordinary share. SouFun plans to set a record date and make the dividend payment in the third quarter of 2012.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| SOUFUN HOLDINGS LIMITED | ||||||
| By: | /s/ Vincent Tianquan Mo | |||||
| Name: | Vincent Tianquan Mo | |||||
| Title: | Executive Chairman | |||||
| Date: August 23, 2012 | ||||||
Exhibit Index
Exhibit 99.1 – Press Release