H World Group Limited (NASDAQ: HTHT and HKEX: 1179) (“
H
World”, the “
Company”,
“
we” or “
our”), a key player in
the global hotel industry, today announced its unaudited financial
results for the first quarter ended March 31, 2023.
As of March 31, 2023, H World’s worldwide hotel
network in operation totaled 8,592 hotels and 820,099 rooms,
including 128 hotels from DH. During the first quarter of 2023, our
Legacy-Huazhu business opened 262 hotels, including 2 leased and
owned hotels and 260 manachised and franchised hotels, and closed a
total of 209 hotels, including 5 leased and owned hotels and 204
manachised and franchised hotels. During the first quarter of 2023,
the Legacy-DH business opened 2 hotels, including 1 leased hotel
and 1 manachised and franchised hotel, and closed a total of 6
hotels, including 2 leased hotels and 4 manachised and franchised
hotels. As of March 31, 2023, H World had a total of 2,339 unopened
hotels in the pipeline, including 2,304 hotels from the
Legacy-Huazhu business and 35 hotels from the Legacy-DH
business.
Legacy-Huazhu Only
– First Quarter 2023 Operational
Highlights
As of March 31, 2023,
Legacy-Huazhu had 8,464 hotels in operation, including 620
leased and owned hotels, and 7,844 manachised and franchised
hotels. In addition, as of the same date, Legacy-Huazhu had
793,927 hotel rooms in operation, including 88,416 rooms under the
lease and ownership model, and 705,511 rooms under the manachise
and franchise models. Legacy-Huazhu also had 2,304 unopened
hotels in its pipeline, including 13 leased and owned hotels, and
2,291 manachised and franchised hotels. The following discusses
Legacy-Huazhu’s RevPAR, average daily room rate
(“ADR”) and occupancy rate for its leased and
owned hotels, as well as manachised and franchised hotels for the
periods indicated.
- The ADR was RMB277 in the first
quarter of 2023, compared with RMB224 in the first quarter of 2022,
RMB240 in the previous quarter, and RMB221 in the first quarter of
2019.
- The occupancy rate for all the
Legacy-Huazhu hotels in operation was 75.6% in the first quarter of
2023, compared with 59.2% in the first quarter of 2022, 66.2% in
the previous quarter, and 80.6% in the first quarter of 2019.
- Blended RevPAR was RMB210 in the
first quarter of 2023, compared with RMB132 in the first quarter of
2022, RMB159 in the previous quarter, and RMB178 in the first
quarter of 2019.
- For all the Legacy-Huazhu hotels
which had been in operation for at least 18 months, the same-hotel
RevPAR was RMB210 in the first quarter of 2023, representing a
51.8% increase from RMB138 in the first quarter of 2022, with a
20.8% increase in ADR and a 15.7 percentage-point increase in
occupancy rate.
Legacy-DH Only
– First Quarter of 2023 Operational
Highlights
As of March 31, 2023, Legacy-DH had
128 hotels in operation, including 80 leased hotels and 48
manachised and franchised hotels. In addition, as of the same date,
Legacy-DH had 26,172 hotel rooms in operation, including
15,497 rooms under the lease model, and 10,675 rooms under the
manachise and franchise models. Legacy-DH also had 35 unopened
hotels in the pipeline, including 25 leased hotels and 10
manachised and franchised hotels. The following discusses
Legacy-DH’s RevPAR, ADR and occupancy rate for its leased as well
as manachised and franchised hotels (excluding hotels temporarily
closed) for the periods indicated.
- The ADR was EUR104 in the first
quarter of 2023, compared with EUR88 in the first quarter of 2022
and EUR122 in the previous quarter.
- The occupancy rate for all
Legacy-DH hotels in operation was 53.5% in the first quarter of
2023, compared with 38.0% in the first quarter of 2022 and 59.3% in
the previous quarter.
- Blended RevPAR was EUR55 in the
first quarter of 2023, compared with EUR33 in the first quarter of
2022 and EUR72 in the previous quarter.
Jin Hui, CEO of H World commented: “We are very
pleased to see a strong beginning of the year in China
post-reopening. For our Legacy-Huazhu business, RevPAR in Q1 2023
recovered to 118% of the Q1 2019 level. Broken down into monthly
numbers, our RevPAR in January, February and March 2023 recovered
to 96%, 140% and 120% of the 2019 levels of the corresponding
months, respectively. The strong recovery was largely driven by the
ADR growth in the first quarter due to pent-up demand, a
combination of product mix change and continued product upgrades,
as well as market penetration and synergy through regional offices.
More importantly, our franchisees’ confidence level also gradually
improved. It led to a strong momentum for our new signings,
reaching over 670 new hotels during the quarter.”
“Regarding our business outside China, our
Legacy-DH business continued its promising business recovery. Q1
2023 Blended RevPAR recovered to 94% of the 2019 level.”
First Quarter of 2023 Unaudited
Financial Results
(RMB in millions) |
Q1 2022 |
Q4 2022 |
Q1 2023 |
Revenue: |
|
|
|
Leased and owned hotels |
1,642 |
2,450 |
2,874 |
Manachised and franchised hotels |
989 |
1,158 |
1,554 |
Others |
50 |
98 |
52 |
Total revenue |
2,681 |
3,706 |
4,480 |
Revenue in the first quarter of
2023 was RMB4.5 billion (US$652 million), representing a 67.1%
year-over-year increase and a 20.9% sequential increase. Revenue
from the Legacy-Huazhu segment in the first quarter of 2023 was
RMB3.6 billion, representing a 58.0% year-over-year increase and a
30.4% sequential increase. The 58.0% year-over-year increase
exceeds the previously announced revenue guidance of a 53% to 57%
increase, which was mainly due to continued product upgrades,
operational optimization at regional headquarters, and pent-up
demand post-Covid re-opening policy. Revenue from the Legacy-DH
segment in the first quarter of 2023 was RMB886 million,
representing a 118.2% year-over-year increase and a 6.6% sequential
decrease. The year-over-year increase was mainly due to the
recovery of our European business since Europe’s opening-up in
mid-February in 2022, and the sequential decrease was mainly due to
hotel closures and seasonality.
Revenue from leased and owned
hotels in the first quarter of 2023 was RMB2.9 billion
(US$418 million), representing a 75.0% year-over-year increase and
a 17.3% sequential increase. Revenue from leased and owned hotels
from the Legacy-Huazhu segment in the first quarter of 2023 was
RMB2.0 billion, representing a 60.6% year-over-year increase.
Revenue from leased and owned hotels from the Legacy-DH segment in
the first quarter of 2023 was RMB854 million, representing a 122.4%
year-over-year increase.
Revenue from manachised and franchised
hotels in the first quarter of 2023 was RMB1.6 billion
(US$226 million), representing a 57.1% year-over-year increase.
Revenue from our Legacy-Huazhu segment from manachised and
franchised hotels in the first quarter of 2023 was RMB1.5 billion,
representing a 57.7% year-over-year increase. Revenue from
manachised and franchised hotels from the Legacy-DH segment in the
first quarter of 2023 was RMB18 million, representing a 20.0%
year-over-year increase.
Other revenue represents
revenue generated from businesses other than our hotel operations,
which mainly includes revenue from the provision of IT products and
services and Huazhu Mall™ and other revenue from the Legacy-DH
segment, totaling RMB52 million (US$8 million) in the first quarter
of 2023, compared to RMB50 million in the first quarter of 2022 and
RMB98 million in the previous quarter.
(RMB in millions) |
Q1 2022 |
|
Q4 2022 |
|
Q1 2023 |
|
Operating costs and expenses: |
|
|
|
Hotel operating costs |
(2,813 |
) |
(3,430 |
) |
(3,250 |
) |
Other operating costs |
(11 |
) |
(22 |
) |
(11 |
) |
Selling and marketing expenses |
(122 |
) |
(169 |
) |
(195 |
) |
General and administrative expenses |
(462 |
) |
(440 |
) |
(425 |
) |
Pre-opening expenses |
(26 |
) |
(14 |
) |
(9 |
) |
Total operating costs and expenses |
(3,434 |
) |
(4,075 |
) |
(3,890 |
) |
Hotel operating costs in the
first quarter of 2023 were RMB3.3 billion (US$473 million),
compared to RMB2.8 billion in the first quarter of 2022 and RMB3.4
billion in the previous quarter. The year-over-year increase was
mainly due to the recovery of Legacy-DH business. Hotel operating
costs from the Legacy-Huazhu segment in the first quarter of 2023
were RMB2.4 billion, which represented 66.3% of the quarter’s
revenue, compared to RMB2.3 billion or 99.1% of the revenue in the
first quarter in 2022 and RMB2.4 billion or 88.7% of the revenue
for the previous quarter.
Selling and marketing expenses
in the first quarter of 2023 were RMB195 million (US$28 million),
compared to RMB122 million in the first quarter of 2022 and RMB169
million in the previous quarter. The increase was mainly due to the
recovery of both Legacy-Huazhu and Legacy-DH businesses. Selling
and marketing expenses from the Legacy-Huazhu segment in the first
quarter of 2023 were RMB117 million, which represented 3.3% of this
quarter’s revenue, compared to RMB78 million or 3.4% of the revenue
in the first quarter in 2022, and RMB88 million or 3.2% of the
revenue for the previous quarter.
General and administrative
expenses in the first quarter of 2023 were RMB425 million
(US$62 million), compared to RMB462 million in the first quarter of
2022 and RMB440 million in the previous quarter. The decrease was
mainly due to streamlined headquarters expenses. General and
administrative expenses from the Legacy-Huazhu segment in the first
quarter of 2023 were RMB312 million, which represented 8.7% of this
quarter’s revenue, compared to RMB346 million or 15.2% in the first
quarter in 2022 and RMB320 million or 11.6% for the previous
quarter.
Pre-opening expenses in the
first quarter of 2023 were primarily related to the Legacy-Huazhu
segment and totaled RMB9 million (US$1 million), compared to RMB26
million in the first quarter of 2022 and RMB14 million in the
previous quarter.
Other operating income, net in
the first quarter of 2023 was RMB74 million (US$11 million),
compared to RMB45 million in the first quarter of 2022 and RMB276
million in the previous quarter.
Income from operations in the
first quarter of 2023 was RMB664 million (US$97 million), compared
to losses from operations of RMB708 million in the first quarter of
2022 and losses from operations of RMB93 million in the previous
quarter. Income from operations from the Legacy-Huazhu segment in
the first quarter of 2023 was RMB822 million, compared to losses
from operations of RMB416 million in the first quarter of 2022 and
losses from operations of RMB3 million in the previous quarter. The
Legacy-DH segment had a loss from operations of RMB158 million in
the first quarter of 2023, compared to RMB292 million in the first
quarter of 2022 and RMB90 million in the previous quarter.
Operating margin, defined as
income from operations as a percentage of revenue, was 14.8% in the
first quarter of 2023, compared with a negative 26.4% in the first
quarter of 2022 and a negative 2.5% for the previous quarter.
Operating margin from the Legacy-Huazhu segment in the first
quarter of 2023 was 22.9%, compared with a negative 18.3% in the
first quarter of 2022 and a negative 0.1% in the previous
quarter.
Other income, net in the first
quarter of 2023 was RMB514 million (US$75 million), compared to
RMB59 million in the first quarter of 2022 and a negative RMB65
million for the previous quarter. The increase was mainly due to
the sale of all of the Company’s holdings of Accor shares.
Gains from fair value changes of equity
securities in the first quarter of 2023 were RMB13 million
(US$2 million), compared to RMB54 million in the first quarter of
2022, and RMB140 million in the previous quarter. Gains (losses)
from fair value changes of equity securities mainly represent the
unrealized gains (losses) from our investment in equity securities
with readily determinable fair values, such as AccorHotels, but we
sold all of the Company’s holdings of Accor shares in March
2023.
Income tax expense in the first
quarter of 2023 was RMB194 million (US$28 million), compared to an
income tax benefit of RMB131 million in the first quarter of 2022
and income tax expense of RMB203 million in the previous
quarter.
Net income attributable to H World Group
Limited in the first quarter of 2023 was RMB990 million
(US$144 million), compared with a net loss attributable to H World
Group Limited of RMB630 million in the first quarter of 2022 and a
net loss attributable to H World Group Limited of RMB124 million in
the previous quarter. Net income attributable to H World Group
Limited from the Legacy-Huazhu segment was RMB1.2 billion in the
first quarter of 2023, compared with a net loss attributable to H
World Group Limited from the Legacy-Huazhu segment of RMB307
million in the first quarter of 2022 and a net loss attributable to
H World Group Limited from the Legacy-Huazhu segment of RMB84
million in the previous quarter.
EBITDA (non-GAAP) in the first
quarter of 2023 was RMB1.6 billion (US$238 million), compared with
a negative RMB301 million in the first quarter of 2022 and RMB529
million in the previous quarter. EBITDA from the Legacy-Huazhu
segment, which is a segment measure, was RMB1.7 billion in the
first quarter of 2023, compared with a negative RMB61 million in
the first quarter of 2022 and RMB528 million in the previous
quarter. Adjusted EBITDA (non-GAAP), which excluded share-based
compensation expenses and gains (losses) from fair value changes of
equity securities from EBITDA (non-GAAP), was RMB1.7 billion
(US$240 million) in the first quarter of 2023, compared with a
negative RMB333 million in the first quarter of 2022 and RMB398
million in the previous quarter. Adjusted EBITDA from the
Legacy-Huazhu segment (non-GAAP) was RMB1.7 billion in the first
quarter of 2023, compared with a negative RMB93 million in the
first quarter of 2022 and RMB397 million in the previous
quarter.
Cash flow. Operating cash
inflow in the first quarter of 2023 was RMB1.8 billion (US$267
million). Investing cash inflow in the first quarter of 2023 was
RMB2.0 billion (US$289 million). The investing cash inflow was
mainly due to the sale of all of the Company’s holdings of Accor
shares for net proceeds to the Company of approximately EUR300
million in March. Financing cash inflow in the first quarter of
2023 was RMB1.5 billion (US$213 million). The financing cash inflow
was mainly due to our successful completion of a follow-on public
offering of 7,118,500 ADSs with net proceeds of approximately
RMB2.0 billion in January.
Cash and cash equivalents and restricted
cash. As of March 31, 2023, the Company had a total
balance of cash and cash equivalents of RMB9.0 billion (US$1.3
billion) and restricted cash of RMB1.4 billion (US$202
million).
Debt financing. As of March 31,
2023, the Company had a total debt and net cash balance of RMB9.4
billion (US$1.4 billion) and RMB957 million (US$139 million),
respectively, and the unutilized credit facility available to the
Company was RMB2.0 billion.
Guidance In the second quarter
of 2023, H World expects its revenue growth to be in the range of
51%-55% as compared to the second quarter of 2022, or in the range
of 64%-68% excluding DH.
The above forecast reflects the Company’s
current and preliminary view, which is subject to change.
Conference CallH World’s
management will host a conference call at 9 p.m. U.S. Eastern time
on Monday, May 29, 2023 (9 a.m. Hong Kong time on Tuesday, May 30,
2023) following the announcement.
To join by phone, all participants must
pre-register this conference call using the Participant
Registration link of
https://register.vevent.com/register/BI06e8970e467241ed8d3d88d65a544383.
Upon registration, each participant will receive details for the
conference call, including dial-in numbers, conference call
passcode and a unique access PIN.
A live webcast of the call can be accessed at
https://edge.media-server.com/mmc/p/kc248r24 or the Company’s
website at
https://ir.hworld.com/news-and-events/events-calendar.
A replay of the conference call will be
available for twelve months from the date of the conference at the
Company’s website,
https://ir.hworld.com/news-and-events/events-calendar.
Use of Non-GAAP Financial
MeasuresTo supplement the Company’s unaudited consolidated
financial results presented in accordance with U.S.
Generally-Accepted Accounting Principles (“GAAP”),
the Company uses the following non-GAAP measures defined as
non-GAAP financial measures by the U.S. Securities and Exchange
Commission (“SEC”): adjusted net income (loss)
attributable to H World Group Limited excluding share-based
compensation expenses and gains (losses) from fair value changes of
equity securities; adjusted basic and diluted earnings (losses) per
share/ADS excluding share-based compensation expenses and gains
(losses) from fair value changes of equity securities; EBITDA;
adjusted EBITDA; adjusted EBITDA from the Legacy-Huazhu segment and
adjusted EBITDA from the Legacy-DH segment excluding share-based
compensation expenses and gains (losses) from fair value changes of
equity securities. The presentation of these non-GAAP financial
measures is not intended to be considered in isolation or as a
substitute for the financial information prepared and presented in
accordance with U.S. GAAP. For more information on these non-GAAP
financial measures, please see the table captioned “Unaudited
Reconciliations of GAAP and non-GAAP Results” set forth at the end
of this release. The Company believes that these non-GAAP financial
measures provide meaningful supplemental information regarding
Company performance by excluding share-based compensation expenses
and gains (losses) from fair value changes of equity securities
that may not be indicative of Company operating performance. The
Company believes that both management and investors benefit from
referring to these non-GAAP financial measures in assessing Company
performance and when planning and forecasting future periods. These
non-GAAP financial measures also facilitate management’s internal
comparisons to the Company’s historical performance. The Company
believes these non-GAAP financial measures are also useful to
investors in allowing for greater transparency with respect to
supplemental information used regularly by Company management in
financial and operational decision-making. A limitation of using
non-GAAP financial measures excluding share-based compensation
expenses and gains (losses) from fair value changes of equity
securities is that share-based compensation expenses and gains
(losses) from fair value changes of equity securities have been and
may continue to be significant and recurring in the Company’s
business. Management compensates for these limitations by providing
specific information regarding the GAAP amounts excluded from each
non-GAAP measure. The accompanying tables have more details on the
reconciliations between GAAP financial measures that are most
directly comparable to non-GAAP financial measures.
The Company believes that EBITDA is a useful
financial metric to assess the operating and financial performance
before the impact of investing and financing transactions and
income taxes, given the significant investments that the Company
has made in leasehold improvements, depreciation and amortization
expense that comprise a significant portion of the Company’s cost
structure. In addition, the Company believes that EBITDA is widely
used by other companies in the lodging industry and may be used by
investors as a measure of financial performance. The Company
believes that EBITDA information provides investors with a useful
tool for comparability between periods because it excludes
depreciation and amortization expense attributable to capital
expenditures. The Company also uses adjusted EBITDA, which is
defined as EBITDA before share-based compensation expenses and
gains (losses) from fair value changes of equity securities, to
assess operating results of its hotels in operation. The Company
believes that the exclusion of share-based compensation expenses
and gains (losses) from fair value changes of equity securities
helps facilitate year-over-year comparisons of the results of
operations as the share-based compensation expenses and gains
(losses) from fair value changes of equity securities may not be
indicative of Company operating performance.
The Company believes that gains and losses from
changes in fair value of equity securities are generally less
significant in understanding the Company’s reported results or
evaluating the economic performance of its businesses. These gains
and losses have caused and may continue to cause significant
volatility in reported periodic earnings.
Therefore, the Company believes adjusted EBITDA
more closely reflects the financial performance capability of our
hotels. The presentation of EBITDA and adjusted EBITDA should not
be construed as an indication that the Company’s future results
will be unaffected by other charges and gains considered to be
outside the ordinary course of business.
The use of EBITDA and adjusted EBITDA has
certain limitations. Depreciation and amortization expense for
various long-term assets (including land use rights), income tax,
interest expense and interest income have been and will be incurred
and are not reflected in the presentation of EBITDA. Share-based
compensation expenses and gains (losses) from fair value changes of
equity securities have been and will be incurred and are not
reflected in the presentation of adjusted EBITDA. Each of these
items should also be considered in the overall evaluation of the
results. The Company compensates for these limitations by providing
the relevant disclosure of depreciation and amortization, interest
income, interest expense, income tax expense, share-based
compensation expenses, and gains (losses) from fair value changes
of equity securities and other relevant items both in the
reconciliations to the U.S. GAAP financial measures and in the
consolidated financial statements, all of which should be
considered when evaluating the performance of the Company.
The terms EBITDA and adjusted EBITDA are not
defined under U.S. GAAP, and neither EBITDA nor adjusted EBITDA is
a measure of net income, operating income, operating performance or
liquidity presented in accordance with U.S. GAAP. When assessing
the operating and financial performance, investors should not
consider these data in isolation or as a substitute for the
Company’s net income, operating income or any other operating
performance measure that is calculated in accordance with U.S.
GAAP. In addition, the Company’s EBITDA or adjusted EBITDA may not
be comparable to EBITDA or adjusted EBITDA or similarly titled
measures utilized by other companies since such other companies may
not calculate EBITDA or adjusted EBITDA in the same manner as the
Company does.
Reconciliations of the Company’s non-GAAP
financial measures, including EBITDA and adjusted EBITDA, to the
consolidated statement of operations information are included at
the end of this press release.
About H World Group
LimitedOriginated in China, H World Group Limited is a key
player in the global hotel industry. As of March 31, 2023, H
World operated 8,592 hotels with 820,099 rooms in operation in 18
countries. H World’s brands include Hi Inn, Elan Hotel, HanTing
Hotel, JI Hotel, Starway Hotel, Orange Hotel, Crystal Orange Hotel,
Manxin Hotel, Madison Hotel, Joya Hotel, Blossom House, Ni Hao
Hotel, CitiGO Hotel, Steigenberger Hotels & Resorts, MAXX, Jaz
in the City, IntercityHotel, Zleep Hotels, Steigenberger Icon and
Song Hotels. In addition, H World also has the rights as master
franchisee for Mercure, Ibis and Ibis Styles, and
co-development rights for Grand Mercure and Novotel, in the
pan-China region.
H World’s business includes leased and owned,
manachised and franchised models. Under the lease and ownership
model, H World directly operates hotels typically located on leased
or owned properties. Under the manachise model, H World manages
manachised hotels through the on-site hotel managers that H World
appoints, and H World collects fees from franchisees. Under the
franchise model, H World provides training, reservations and
support services to the franchised hotels, and collects fees from
franchisees but does not appoint on-site hotel managers. H World
applies a consistent standard and platform across all of its
hotels. As of March 31, 2023, H World operates 13 percent of its
hotel rooms under the lease and ownership model, and 87 percent
under manachise and franchise models.
For more information, please visit H World’s
website: https://ir.hworld.com.
Safe Harbor Statement Under the U.S. Private
Securities Litigation Reform Act of 1995: The information in this
release contains forward-looking statements which involve risks and
uncertainties. Such factors and risks include our anticipated
growth strategies; our future results of operations and financial
condition; economic conditions; the regulatory environment; our
ability to attract and retain customers and leverage our brands;
trends and competition in the lodging industry; the expected growth
of demand for lodging; and other factors and risks detailed in our
filings with the U.S. Securities and Exchange Commission. Any
statements contained herein that are not statements of historical
fact may be deemed to be forward-looking statements, which may be
identified by terminology such as “may,” “should,” “will,”
“expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,”
“predict,” “potential,” “forecast,” “project” or “continue,” the
negative of such terms or other comparable terminology. Readers
should not rely on forward-looking statements as predictions of
future events or results.
H World undertakes no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, unless required by
applicable law.
—Financial Tables and Operational Data
Follow—
H World Group Limited |
Unaudited Condensed Consolidated Balance
Sheets |
|
December 31, 2022 |
|
|
March 31, 2023 |
|
RMB |
RMB |
US$3 |
|
(in millions) |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
3,583 |
|
|
8,963 |
|
|
1,305 |
|
Restricted cash |
1,503 |
|
|
1,389 |
|
|
202 |
|
Short-term investments |
1,788 |
|
|
96 |
|
|
14 |
|
Accounts receivable, net |
1,113 |
|
|
936 |
|
|
136 |
|
Loan receivables, net |
134 |
|
|
129 |
|
|
19 |
|
Amounts due from related parties, current |
178 |
|
|
195 |
|
|
28 |
|
Inventories |
70 |
|
|
63 |
|
|
9 |
|
Other current assets, net |
809 |
|
|
804 |
|
|
117 |
|
Total current assets |
9,178 |
|
|
12,575 |
|
|
1,830 |
|
|
|
|
|
Property and equipment, net |
6,784 |
|
|
6,544 |
|
|
953 |
|
Intangible assets, net |
5,278 |
|
|
5,302 |
|
|
772 |
|
Operating lease right-of-use assets |
28,970 |
|
|
29,200 |
|
|
4,252 |
|
Finance lease right-of-use assets |
2,047 |
|
|
2,096 |
|
|
305 |
|
Land use rights, net |
199 |
|
|
197 |
|
|
29 |
|
Long-term investments |
1,945 |
|
|
1,931 |
|
|
281 |
|
Goodwill |
5,195 |
|
|
5,216 |
|
|
760 |
|
Amounts due from related parties, non-current |
6 |
|
|
6 |
|
|
1 |
|
Loan receivables, net |
124 |
|
|
127 |
|
|
18 |
|
Other assets, net |
688 |
|
|
692 |
|
|
101 |
|
Deferred tax assets |
1,093 |
|
|
1,086 |
|
|
158 |
|
Total assets |
61,507 |
|
|
64,972 |
|
|
9,460 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current liabilities: |
|
|
|
Short-term debt |
3,288 |
|
|
2,874 |
|
|
418 |
|
Accounts payable |
1,171 |
|
|
915 |
|
|
133 |
|
Amounts due to related parties |
71 |
|
|
95 |
|
|
14 |
|
Salary and welfare payables |
657 |
|
|
538 |
|
|
78 |
|
Deferred revenue |
1,308 |
|
|
1,400 |
|
|
204 |
|
Operating lease liabilities, current |
3,773 |
|
|
3,799 |
|
|
553 |
|
Finance lease liabilities, current |
41 |
|
|
44 |
|
|
6 |
|
Accrued expenses and other current liabilities |
2,337 |
|
|
3,388 |
|
|
493 |
|
Income tax payable |
500 |
|
|
381 |
|
|
56 |
|
Total current liabilities |
13,146 |
|
|
13,434 |
|
|
1,955 |
|
|
|
|
|
Long-term debt |
6,635 |
|
|
6,521 |
|
|
950 |
|
Operating lease liabilities, non-current |
27,637 |
|
|
27,777 |
|
|
4,045 |
|
Finance lease liabilities, non-current |
2,513 |
|
|
2,577 |
|
|
375 |
|
Deferred revenue |
828 |
|
|
870 |
|
|
127 |
|
Other long-term liabilities |
977 |
|
|
1,003 |
|
|
146 |
|
Deferred tax liabilities |
858 |
|
|
849 |
|
|
124 |
|
Retirement benefit obligations |
110 |
|
|
111 |
|
|
16 |
|
Total liabilities |
52,704 |
|
|
53,142 |
|
|
7,738 |
|
|
|
|
|
Equity: |
|
|
|
Ordinary shares |
0 |
|
|
0 |
|
|
0 |
|
Treasury shares |
(441 |
) |
|
(441 |
) |
|
(64 |
) |
Additional paid-in capital |
10,138 |
|
|
12,129 |
|
|
1,766 |
|
Retained earnings |
(1,200 |
) |
|
(210 |
) |
|
(31 |
) |
Accumulated other comprehensive income |
232 |
|
|
271 |
|
|
39 |
|
Total H World Group Limited shareholders' equity |
8,729 |
|
|
11,749 |
|
|
1,710 |
|
Noncontrolling interest |
74 |
|
|
81 |
|
|
12 |
|
Total equity |
8,803 |
|
|
11,830 |
|
|
1,722 |
|
Total liabilities and equity |
61,507 |
|
|
64,972 |
|
|
9,460 |
|
H World Group Limited |
Unaudited Condensed Consolidated Statements of
Comprehensive Income |
|
|
Quarter Ended |
|
|
March 31, 2022 |
|
December 31, 2022 |
|
March 31, 2023 |
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
(in millions, except share, per-share and per-ADS
data) |
Revenue: |
|
|
|
|
|
|
|
|
Leased and owned hotels |
|
|
1,642 |
|
|
|
2,450 |
|
|
|
2,874 |
|
|
|
418 |
|
Manachised and franchised hotels |
|
|
989 |
|
|
|
1,158 |
|
|
|
1,554 |
|
|
|
226 |
|
Others |
|
|
50 |
|
|
|
98 |
|
|
|
52 |
|
|
|
8 |
|
Total revenues |
|
|
2,681 |
|
|
|
3,706 |
|
|
|
4,480 |
|
|
|
652 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hotel operating costs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rents |
|
|
(1,026 |
) |
|
|
(956 |
) |
|
|
(1,051 |
) |
|
|
(153 |
) |
Utilities |
|
|
(155 |
) |
|
|
(162 |
) |
|
|
(204 |
) |
|
|
(30 |
) |
Personnel costs |
|
|
(838 |
) |
|
|
(981 |
) |
|
|
(1,036 |
) |
|
|
(151 |
) |
Depreciation and amortization |
|
|
(357 |
) |
|
|
(351 |
) |
|
|
(346 |
) |
|
|
(50 |
) |
Consumables, food and beverage |
|
|
(206 |
) |
|
|
(289 |
) |
|
|
(278 |
) |
|
|
(40 |
) |
Others |
|
|
(231 |
) |
|
|
(691 |
) |
|
|
(335 |
) |
|
|
(49 |
) |
Total hotel operating costs |
|
|
(2,813 |
) |
|
|
(3,430 |
) |
|
|
(3,250 |
) |
|
|
(473 |
) |
Other operating costs |
|
|
(11 |
) |
|
|
(22 |
) |
|
|
(11 |
) |
|
|
(2 |
) |
Selling and marketing expenses |
|
|
(122 |
) |
|
|
(169 |
) |
|
|
(195 |
) |
|
|
(28 |
) |
General and administrative expenses |
|
|
(462 |
) |
|
|
(440 |
) |
|
|
(425 |
) |
|
|
(62 |
) |
Pre-opening expenses |
|
|
(26 |
) |
|
|
(14 |
) |
|
|
(9 |
) |
|
|
(1 |
) |
Total operating costs and
expenses |
|
|
(3,434 |
) |
|
|
(4,075 |
) |
|
|
(3,890 |
) |
|
|
(566 |
) |
Other operating income (expense), net |
|
|
45 |
|
|
|
276 |
|
|
|
74 |
|
|
|
11 |
|
Income (losses) from
operations |
|
|
(708 |
) |
|
|
(93 |
) |
|
|
664 |
|
|
|
97 |
|
Interest income |
|
|
18 |
|
|
|
27 |
|
|
|
44 |
|
|
|
6 |
|
Interest expense |
|
|
(109 |
) |
|
|
(117 |
) |
|
|
(130 |
) |
|
|
(19 |
) |
Other income (expense),
net |
|
|
59 |
|
|
|
(65 |
) |
|
|
514 |
|
|
|
75 |
|
Gains (losses) from fair value
changes of equity securities |
|
|
54 |
|
|
|
140 |
|
|
|
13 |
|
|
|
2 |
|
Foreign exchange gain
(loss) |
|
|
(61 |
) |
|
|
181 |
|
|
|
104 |
|
|
|
15 |
|
Income (loss) before income
taxes |
|
|
(747 |
) |
|
|
73 |
|
|
|
1,209 |
|
|
|
176 |
|
Income tax (expense)
benefit |
|
|
131 |
|
|
|
(203 |
) |
|
|
(194 |
) |
|
|
(28 |
) |
Income (loss) from equity
method investments |
|
|
(33 |
) |
|
|
3 |
|
|
|
(15 |
) |
|
|
(2 |
) |
Net income (loss) |
|
|
(649 |
) |
|
|
(127 |
) |
|
|
1,000 |
|
|
|
146 |
|
Net (income) loss attributable
to noncontrolling interest |
|
|
19 |
|
|
|
3 |
|
|
|
(10 |
) |
|
|
(2 |
) |
Net income (loss) attributable
to H World Group Limited |
|
|
(630 |
) |
|
|
(124 |
) |
|
|
990 |
|
|
|
144 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain arising from defined
benefit plan, net of tax |
|
|
- |
|
|
|
22 |
|
|
|
- |
|
|
|
- |
|
Gains(losses) from fair value
changes of debt securities, net of tax |
|
|
- |
|
|
|
57 |
|
|
|
- |
|
|
|
- |
|
Foreign currency translation
adjustments, net of tax |
|
|
(4 |
) |
|
|
82 |
|
|
|
39 |
|
|
|
6 |
|
Comprehensive income
(loss) |
|
|
(653 |
) |
|
|
34 |
|
|
|
1,039 |
|
|
|
152 |
|
Comprehensive (income) loss
attributable to noncontrolling interest |
|
|
19 |
|
|
|
3 |
|
|
|
(10 |
) |
|
|
(2 |
) |
Comprehensive income (loss)
attributable to H World Group Limited |
|
|
(634 |
) |
|
|
37 |
|
|
|
1,029 |
|
|
|
150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (losses) per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
(0.20 |
) |
|
|
(0.04 |
) |
|
|
0.31 |
|
|
|
0.05 |
|
Diluted |
|
|
(0.20 |
) |
|
|
(0.04 |
) |
|
|
0.30 |
|
|
|
0.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (losses) per ADS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
(2.02 |
) |
|
|
(0.40 |
) |
|
|
3.12 |
|
|
|
0.45 |
|
Diluted |
|
|
(2.02 |
) |
|
|
(0.40 |
) |
|
|
3.05 |
|
|
|
0.44 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares used in computation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
3,118,897,668 |
|
|
|
3,109,528,097 |
|
|
|
3,174,229,716 |
|
|
|
3,174,229,716 |
|
Diluted |
|
|
3,118,897,668 |
|
|
|
3,109,528,097 |
|
|
|
3,343,723,364 |
|
|
|
3,343,723,364 |
|
H World Group Limited |
Unaudited Condensed Consolidated Statements of Cash
Flows |
|
|
Quarter Ended |
|
|
March 31, 2022 |
|
December 31, 2022 |
|
March 31, 2023 |
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
(in millions) |
Operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
|
(649 |
) |
|
|
(127 |
) |
|
|
1,000 |
|
|
|
146 |
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities: |
Share-based compensation |
|
|
22 |
|
|
|
9 |
|
|
|
27 |
|
|
|
4 |
|
Depreciation and amortization, and other |
|
|
399 |
|
|
|
369 |
|
|
|
385 |
|
|
|
56 |
|
Impairment loss |
|
|
- |
|
|
|
390 |
|
|
|
- |
|
|
|
- |
|
Loss (Income) from equity method investments, net of dividends |
|
|
80 |
|
|
|
(3 |
) |
|
|
15 |
|
|
|
2 |
|
Investment (income) loss |
|
|
(57 |
) |
|
|
(362 |
) |
|
|
(544 |
) |
|
|
(79 |
) |
Changes in operating assets and liabilities |
|
|
(888 |
) |
|
|
1,008 |
|
|
|
1,020 |
|
|
|
147 |
|
Other |
|
|
172 |
|
|
|
(242 |
) |
|
|
(59 |
) |
|
|
(9 |
) |
Net cash provided by (used in) operating activities |
|
|
(921 |
) |
|
|
1,042 |
|
|
|
1,844 |
|
|
|
267 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures |
|
|
(425 |
) |
|
|
(229 |
) |
|
|
(222 |
) |
|
|
(32 |
) |
Acquisitions, net of cash received |
|
|
(56 |
) |
|
|
2 |
|
|
|
- |
|
|
|
- |
|
Purchase of investments |
|
|
(77 |
) |
|
|
(23 |
) |
|
|
(1 |
) |
|
|
(0 |
) |
Proceeds from maturity/sale of investments |
|
|
376 |
|
|
|
370 |
|
|
|
2,200 |
|
|
|
320 |
|
Loan advances |
|
|
(74 |
) |
|
|
(30 |
) |
|
|
(34 |
) |
|
|
(5 |
) |
Loan collections |
|
|
55 |
|
|
|
52 |
|
|
|
34 |
|
|
|
5 |
|
Other |
|
|
0 |
|
|
|
7 |
|
|
|
4 |
|
|
|
1 |
|
Net cash provided by (used in) investing activities |
|
|
(201 |
) |
|
|
149 |
|
|
|
1,981 |
|
|
|
289 |
|
|
|
|
|
|
|
|
|
|
Financing activities: |
|
|
|
|
|
|
|
|
Net proceeds from issuance of ordinary shares |
|
|
-- |
|
|
|
- |
|
|
|
1,973 |
|
|
|
287 |
|
Payment of share repurchase |
|
|
(191 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
Proceeds from debt |
|
|
809 |
|
|
|
2,288 |
|
|
|
428 |
|
|
|
62 |
|
Repayment of debt |
|
|
(462 |
) |
|
|
(3,670 |
) |
|
|
(889 |
) |
|
|
(129 |
) |
Other |
|
|
(10 |
) |
|
|
(19 |
) |
|
|
(50 |
) |
|
|
(7 |
) |
Net cash provided by (used in) financing activities |
|
|
146 |
|
|
|
(1,401 |
) |
|
|
1,462 |
|
|
|
213 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash |
|
|
(16 |
) |
|
|
79 |
|
|
|
(21 |
) |
|
|
(3 |
) |
Net increase (decrease) in
cash, cash equivalents and restricted cash |
|
|
(992 |
) |
|
|
(131 |
) |
|
|
5,266 |
|
|
|
766 |
|
Cash, cash equivalents and restricted cash at the beginning of the
period |
|
|
5,141 |
|
|
|
5,217 |
|
|
|
5,086 |
|
|
|
741 |
|
Cash, cash equivalents and restricted cash at the end of the
period |
|
|
4,149 |
|
|
|
5,086 |
|
|
|
10,352 |
|
|
|
1,507 |
|
H World Group Limited |
Unaudited Reconciliation of GAAP and Non-GAAP
Results |
|
|
Quarter Ended |
|
|
March 31, 2022 |
|
December 31, 2022 |
|
March 31, 2023 |
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
(in millions, except shares, per-share and per-ADS
data) |
Net income (loss) attributable to H World Group Limited (GAAP) |
|
|
(630 |
) |
|
|
(124 |
) |
|
|
990 |
|
|
|
144 |
|
Share-based compensation expenses |
|
|
22 |
|
|
|
9 |
|
|
|
27 |
|
|
|
4 |
|
(Gains) losses from fair value changes of equity securities |
|
|
(54 |
) |
|
|
(140 |
) |
|
|
(13 |
) |
|
|
(2 |
) |
Adjusted net income (loss) attributable to H World Group Limited
(non-GAAP) |
|
|
(662 |
) |
|
|
(255 |
) |
|
|
1,004 |
|
|
|
146 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings (losses) per share (non-GAAP) |
Basic |
|
|
(0.21 |
) |
|
|
(0.08 |
) |
|
|
0.32 |
|
|
|
0.05 |
|
Diluted |
|
|
(0.21 |
) |
|
|
(0.08 |
) |
|
|
0.31 |
|
|
|
0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings (losses) per ADS (non-GAAP) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
(2.12 |
) |
|
|
(0.82 |
) |
|
|
3.17 |
|
|
|
0.46 |
|
Diluted |
|
|
(2.12 |
) |
|
|
(0.82 |
) |
|
|
3.09 |
|
|
|
0.45 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares used in computation |
Basic |
|
|
3,118,897,668 |
|
|
|
3,109,528,097 |
|
|
|
3,174,229,716 |
|
|
|
3,174,229,716 |
|
Diluted |
|
|
3,118,897,668 |
|
|
|
3,109,528,097 |
|
|
|
3,343,723,364 |
|
|
|
3,343,723,364 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended |
|
|
|
March 31, 2022 |
|
|
|
December 31, 2022 |
|
|
|
March 31, 2023 |
|
|
|
|
RMB |
|
|
|
RMB |
|
|
|
RMB |
|
|
|
US$ |
|
|
|
|
(in millions, except per-share and per-ADS
data) |
Net income (loss) attributable to H World Group Limited
(GAAP) |
|
|
(630 |
) |
|
|
(124 |
) |
|
|
990 |
|
|
|
144 |
|
Interest income |
|
|
(18 |
) |
|
|
(27 |
) |
|
|
(44 |
) |
|
|
(6 |
) |
Interest expense |
|
|
109 |
|
|
|
117 |
|
|
|
130 |
|
|
|
19 |
|
Income tax expense (benefit) |
|
|
(131 |
) |
|
|
203 |
|
|
|
194 |
|
|
|
28 |
|
Depreciation and amortization |
|
|
369 |
|
|
|
360 |
|
|
|
367 |
|
|
|
53 |
|
EBITDA (non-GAAP) |
|
|
(301 |
) |
|
|
529 |
|
|
|
1,637 |
|
|
|
238 |
|
Share-based compensation expense |
|
|
22 |
|
|
|
9 |
|
|
|
27 |
|
|
|
4 |
|
(Gains) losses from fair value changes of equity securities |
|
|
(54 |
) |
|
|
(140 |
) |
|
|
(13 |
) |
|
|
(2 |
) |
Adjusted EBITDA (non-GAAP) |
|
|
(333 |
) |
|
|
398 |
|
|
|
1,651 |
|
|
|
240 |
|
H World Group Limited |
Financial Summary |
|
|
Quarter Ended March31, 2022 |
|
Quarter Ended December 31, 2022 |
|
Quarter Ended March 31, 2023 |
|
|
Legacy- Huazhu |
|
Legacy- DH |
|
Total |
|
Legacy- Huazhu |
|
Legacy- DH |
|
Total |
|
Legacy- Huazhu |
|
Legacy- DH |
|
Total |
|
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
(in millions) |
|
(in millions) |
|
(in millions) |
Leased and owned hotels |
|
|
1,258 |
|
|
|
384 |
|
|
|
1,642 |
|
|
|
1,537 |
|
|
|
913 |
|
|
|
2,450 |
|
|
|
2,020 |
|
|
|
854 |
|
|
|
2,874 |
|
|
|
418 |
|
Manachised and franchised
hotels |
|
|
974 |
|
|
|
15 |
|
|
|
989 |
|
|
|
1,130 |
|
|
|
28 |
|
|
|
1,158 |
|
|
|
1,536 |
|
|
|
18 |
|
|
|
1,554 |
|
|
|
226 |
|
Others |
|
|
43 |
|
|
|
7 |
|
|
|
50 |
|
|
|
90 |
|
|
|
8 |
|
|
|
98 |
|
|
|
38 |
|
|
|
14 |
|
|
|
52 |
|
|
|
8 |
|
Revenue |
|
|
2,275 |
|
|
|
406 |
|
|
|
2,681 |
|
|
|
2,757 |
|
|
|
949 |
|
|
|
3,706 |
|
|
|
3,594 |
|
|
|
886 |
|
|
|
4,480 |
|
|
|
652 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hotel operating costs |
|
|
(2,255 |
) |
|
|
(558 |
) |
|
|
(2,813 |
) |
|
|
(2,446 |
) |
|
|
(984 |
) |
|
|
(3,430 |
) |
|
|
(2,383 |
) |
|
|
(867 |
) |
|
|
(3,250 |
) |
|
|
(473 |
) |
Selling and marketing
expenses |
|
|
(78 |
) |
|
|
(44 |
) |
|
|
(122 |
) |
|
|
(88 |
) |
|
|
(81 |
) |
|
|
(169 |
) |
|
|
(117 |
) |
|
|
(78 |
) |
|
|
(195 |
) |
|
|
(28 |
) |
General and administrative
expenses |
|
|
(346 |
) |
|
|
(116 |
) |
|
|
(462 |
) |
|
|
(320 |
) |
|
|
(120 |
) |
|
|
(440 |
) |
|
|
(312 |
) |
|
|
(113 |
) |
|
|
(425 |
) |
|
|
(62 |
) |
Pre-opening expenses |
|
|
(26 |
) |
|
|
- |
|
|
|
(26 |
) |
|
|
(14 |
) |
|
|
(0 |
) |
|
|
(14 |
) |
|
|
(9 |
) |
|
|
0 |
|
|
|
(9 |
) |
|
|
(1 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (losses) from
operations |
|
|
(416 |
) |
|
|
(292 |
) |
|
|
(708 |
) |
|
|
(3 |
) |
|
|
(90 |
) |
|
|
(93 |
) |
|
|
822 |
|
|
|
(158 |
) |
|
|
664 |
|
|
|
97 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to H World Group Limited |
|
|
(307 |
) |
|
|
(323 |
) |
|
|
(630 |
) |
|
|
(84 |
) |
|
|
(40 |
) |
|
|
(124 |
) |
|
|
1,155 |
|
|
|
(165 |
) |
|
|
990 |
|
|
|
144 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income |
|
|
(18 |
) |
|
|
(0 |
) |
|
|
(18 |
) |
|
|
(27 |
) |
|
|
(0 |
) |
|
|
(27 |
) |
|
|
(44 |
) |
|
|
(0 |
) |
|
|
(44 |
) |
|
|
(6 |
) |
Interest expense |
|
|
77 |
|
|
|
32 |
|
|
|
109 |
|
|
|
84 |
|
|
|
33 |
|
|
|
117 |
|
|
|
99 |
|
|
|
31 |
|
|
|
130 |
|
|
|
19 |
|
Income tax expense
(benefit) |
|
|
(123 |
) |
|
|
(8 |
) |
|
|
(131 |
) |
|
|
260 |
|
|
|
(57 |
) |
|
|
203 |
|
|
|
202 |
|
|
|
(8 |
) |
|
|
194 |
|
|
|
28 |
|
Depreciation and
amortization |
|
|
310 |
|
|
|
59 |
|
|
|
369 |
|
|
|
295 |
|
|
|
65 |
|
|
|
360 |
|
|
|
304 |
|
|
|
63 |
|
|
|
367 |
|
|
|
53 |
|
EBITDA
(non-GAAP) |
|
|
(61 |
) |
|
|
(240 |
) |
|
|
(301 |
) |
|
|
528 |
|
|
|
1 |
|
|
|
529 |
|
|
|
1,716 |
|
|
|
(79 |
) |
|
|
1,637 |
|
|
|
238 |
|
Share-based Compensation |
|
|
22 |
|
|
|
- |
|
|
|
22 |
|
|
|
9 |
|
|
|
- |
|
|
|
9 |
|
|
|
27 |
|
|
|
- |
|
|
|
27 |
|
|
|
4 |
|
(Gains) losses from fair value
changes of equity securities |
|
|
(54 |
) |
|
|
- |
|
|
|
(54 |
) |
|
|
(140 |
) |
|
|
- |
|
|
|
(140 |
) |
|
|
(13 |
) |
|
|
- |
|
|
|
(13 |
) |
|
|
(2 |
) |
Adjusted EBITDA
(non-GAAP) |
|
|
(93 |
) |
|
|
(240 |
) |
|
|
(333 |
) |
|
|
397 |
|
|
|
1 |
|
|
|
398 |
|
|
|
1,730 |
|
|
|
(79 |
) |
|
|
1,651 |
|
|
|
240 |
|
Operating Results:
Legacy-Huazhu(1)
|
Number of hotels |
|
Number of rooms |
|
Openedin Q1 2023 |
Closed(2)in Q1
2023 |
Net addedin Q1 2023 |
As ofMarch 31, 2023 |
|
As ofMarch 31, 2023 |
|
|
Leased and owned hotels |
2 |
(5 |
) |
(3 |
) |
620 |
|
88,416 |
Manachised and franchised hotels |
260 |
(204 |
) |
56 |
|
7,844 |
|
705,511 |
Total |
262 |
(209 |
) |
53 |
|
8,464 |
|
793,927 |
(1)Legacy-Huazhu refers to H World and its subsidiaries, excluding
DH.(2)The reasons for hotel closures mainly included non-compliance
with our brand standards, operating losses, and property-related
issues. In Q1 2023, we temporarily closed 7 hotels for brand
upgrade and business model change purposes. |
|
As of March 31, 2023 |
|
Number of hotels |
Unopened hotels in pipeline |
Economy hotels |
4,880 |
903 |
Leased and owned hotels |
348 |
1 |
Manachised and franchised hotels |
4,532 |
902 |
Midscale and upscale hotels |
3,584 |
1,401 |
Leased and owned hotels |
272 |
12 |
Manachised and franchised hotels |
3,312 |
1,389 |
Total |
8,464 |
2,304 |
|
For the quarter ended |
|
|
March 31, |
December 31, |
March 31, |
yoy |
|
2022 |
|
2022 |
|
2023 |
|
change |
Average daily room rate (in RMB) |
|
|
|
Leased and owned hotels |
263 |
|
279 |
|
337 |
|
28.4 |
% |
Manachised and franchised hotels |
218 |
|
236 |
|
269 |
|
23.4 |
% |
Blended |
224 |
|
240 |
|
277 |
|
23.9 |
% |
Occupancy Rate (as a percentage) |
|
|
|
Leased and owned hotels |
56.7 |
% |
63.1 |
% |
76.3 |
% |
+19.6 p.p. |
|
Manachised and franchised hotels |
59.6 |
% |
66.6 |
% |
75.5 |
% |
+16.0 p.p. |
|
Blended |
59.2 |
% |
66.2 |
% |
75.6 |
% |
+16.4 p.p. |
|
RevPAR (in RMB) |
|
|
|
|
Leased and owned hotels |
149 |
|
176 |
|
257 |
|
72.9 |
% |
Manachised and franchised hotels |
130 |
|
157 |
|
203 |
|
56.4 |
% |
Blended |
132 |
|
159 |
|
210 |
|
58.3 |
% |
|
For the quarter ended |
|
March 31, |
March 31, |
yoy |
|
2019 |
|
2023 |
|
change |
Average daily room rate (in RMB) |
|
|
Leased and owned hotels |
258 |
|
337 |
|
30.8 |
% |
Manachised and franchised hotels |
211 |
|
269 |
|
27.4 |
% |
Blended |
221 |
|
277 |
|
25.4 |
% |
Occupancy Rate (as a percentage) |
|
|
Leased and owned hotels |
83.6 |
% |
76.3 |
% |
-7.3p.p. |
|
Manachised and franchised hotels |
79.8 |
% |
75.5 |
% |
-4.3p.p. |
|
Blended |
80.6 |
% |
75.6 |
% |
-5.0p.p. |
|
RevPAR (in RMB) |
|
|
|
Leased and owned hotels |
216 |
|
257 |
|
19.4 |
% |
Manachised and franchised hotels |
169 |
|
203 |
|
20.5 |
% |
Blended |
178 |
|
210 |
|
17.6 |
% |
Same-hotel operational data by class |
Mature hotels in operation for more than 18
months |
|
Number of hotels |
Same-hotel RevPAR |
Same-hotel ADR |
Same-hotel Occupancy |
|
As ofMarch 31, |
For the quarter |
yoy |
For the quarter |
yoy |
For the quarter |
yoy |
|
endedMarch 31, |
change |
endedMarch 31, |
change |
endedMarch 31, |
change |
|
2022 |
2023 |
2022 |
2023 |
|
2022 |
2023 |
|
2022 |
|
2023 |
|
(p.p.) |
Economy hotels |
3,427 |
3,427 |
111 |
160 |
44.6 |
% |
171 |
208 |
21.3 |
% |
64.7 |
% |
77.1 |
% |
+12.4 |
Leased and owned hotels |
332 |
332 |
116 |
190 |
63.2 |
% |
188 |
241 |
28.5 |
% |
62.0 |
% |
78.7 |
% |
+16.7 |
Manachised and franchised hotels |
3,095 |
3,095 |
110 |
155 |
41.4 |
% |
168 |
202 |
19.8 |
% |
65.2 |
% |
76.9 |
% |
+11.7 |
Midscale and upscale hotels |
2,433 |
2,433 |
167 |
263 |
57.1 |
% |
292 |
344 |
18.0 |
% |
57.3 |
% |
76.3 |
% |
+19.0 |
Leased and owned hotels |
250 |
250 |
187 |
319 |
71.1 |
% |
355 |
426 |
20.2 |
% |
52.7 |
% |
75.0 |
% |
+22.3 |
Manachised and franchised hotels |
2,183 |
2,183 |
164 |
253 |
54.4 |
% |
282 |
330 |
17.3 |
% |
58.1 |
% |
76.5 |
% |
+18.4 |
Total |
5,860 |
5,860 |
138 |
210 |
51.8 |
% |
227 |
274 |
20.8 |
% |
61.1 |
% |
76.7 |
% |
+15.7 |
Operating Results:
Legacy-DH(3)
|
Number of hotels |
|
Number of rooms |
|
Unopened hotels in pipeline |
|
Opened in Q1 2023 |
Closedin Q1 2023 |
Net added in Q1 2023 |
As of March 31,
2023(4) |
|
As of March 31,2023 |
|
As ofMarch 31,2023 |
|
Leased hotels |
1 |
(2 |
) |
(1 |
) |
80 |
|
15,497 |
|
25 |
Manachised and franchised hotels |
1 |
(4 |
) |
(3 |
) |
48 |
|
10,675 |
|
10 |
Total |
2 |
(6 |
) |
(4 |
) |
128 |
|
26,172 |
|
35 |
(3) Legacy-DH refers to DH.
(4) As of March 31, 2023, a total of 2 hotels were
temporarily closed. 1 hotel was closed due to flood damage, and 1
hotel was closed due to repair work. |
|
For the quarter ended |
|
|
March 31, |
December 31, |
March 31, |
yoy |
|
2022 |
|
2022 |
|
2023 |
|
change |
Average daily room rate (in EUR) |
|
|
|
|
Leased hotels |
90 |
|
114 |
|
108 |
|
19.9 |
% |
Manachised and franchised hotels |
85 |
|
134 |
|
97 |
|
13.9 |
% |
Blended |
88 |
|
122 |
|
104 |
|
17.7 |
% |
Occupancy rate (as a percentage) |
|
|
|
|
Leased hotels |
34.1 |
% |
60.0 |
% |
53.0 |
% |
+18.9 p.p. |
|
Manachised and franchised hotels |
44.0 |
% |
58.3 |
% |
54.1 |
% |
+10.2 p.p. |
|
Blended |
38.0 |
% |
59.3 |
% |
53.5 |
% |
+15.5 p.p. |
|
RevPAR (in EUR) |
|
|
|
|
Leased hotels |
31 |
|
68 |
|
57 |
|
86.2 |
% |
Manachised and franchised hotels |
38 |
|
78 |
|
53 |
|
40.1 |
% |
Blended |
33 |
|
72 |
|
55 |
|
65.8 |
% |
Hotel Portfolio by Brand
|
As of March 31, 2023 |
|
Hotels |
Rooms |
Unopened hotels |
|
in operation |
in pipeline |
Economy hotels |
4,896 |
387,694 |
916 |
HanTing Hotel |
3,285 |
291,489 |
596 |
Hi Inn |
445 |
23,193 |
129 |
Ni Hao Hotel |
184 |
13,553 |
153 |
Elan Hotel |
747 |
35,255 |
1 |
Ibis Hotel |
219 |
22,308 |
24 |
Zleep Hotels |
16 |
1,896 |
13 |
Midscale hotels |
2,956 |
322,093 |
1,103 |
Ibis Styles Hotel |
87 |
9,114 |
34 |
Starway Hotel |
563 |
47,691 |
206 |
JI Hotel |
1,758 |
206,410 |
639 |
Orange Hotel |
548 |
58,878 |
224 |
Upper midscale hotels |
590 |
84,317 |
250 |
CitiGO Hotel |
34 |
5,337 |
5 |
Crystal Orange Hotel |
164 |
21,239 |
60 |
Manxin Hotel |
114 |
10,903 |
57 |
Madison Hotel |
56 |
7,369 |
41 |
Mercure Hotel |
139 |
22,532 |
47 |
Novotel Hotel |
19 |
4,734 |
12 |
IntercityHotel(5) |
56 |
10,742 |
23 |
MAXX(6) |
8 |
1,461 |
5 |
Upscale hotels |
126 |
20,494 |
59 |
Jaz in the City |
3 |
587 |
1 |
Joya Hotel |
8 |
1,368 |
- |
Blossom House |
53 |
2,470 |
46 |
Grand Mercure Hotel |
8 |
1,674 |
4 |
Steigenberger Hotels & Resorts(7) |
54 |
14,395 |
8 |
Luxury hotels |
15 |
2,318 |
5 |
Steigenberger Icon(8) |
9 |
1,847 |
1 |
Song Hotels |
6 |
471 |
4 |
Others |
9 |
3,183 |
6 |
Other hotels(9) |
9 |
3,183 |
6 |
Total |
8,592 |
820,099 |
2,339 |
(5) As of March 31, 2023, 5
operational hotels and 10 pipeline hotels of IntercityHotel were in
China.(6) As of March 31, 2023, 3 operational
hotels and 5 pipeline hotels of MAXX were in
China.(7) As of March 31, 2023, 11 operational
hotels and 3 pipeline hotels of Steigenberger Hotels & Resorts
were in China.(8) As of March 31, 2023, 3
operational hotels of Steigenberger Icon were in
China.(9) Other hotels include other partner
hotels and other hotel brands in Yongle Huazhu Hotel & Resort
Group (excluding Steigenberger Hotels & Resorts and Blossom
House).
_________________________________
1 Hotel turnover refers to total transaction value
of room and non-room revenue from H World hotels (i.e., leased and
operated, manachised and franchised hotels).2 The conversion of
Renminbi (“RMB”) into United States dollars
(“US$”) is based on the exchange rate of
US$1.00=RMB6.8676 on March 31, 2023 as set forth in H.10
statistical release of the U.S. Federal Reserve Board and available
at http://www.federalreserve.gov/releases/h10/hist/dat00_ch.htm.3
The conversion of Renminbi (“RMB”) into United
States dollars (“US$”) is based on the exchange
rate of US$1.00=RMB6.8676 on March 31, 2023 as set forth in H.10
statistical release of the U.S. Federal Reserve Board and available
at
http://www.federalreserve.gov/releases/h10/hist/dat00_ch.htm.
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