H World Group Limited Announces Preliminary Results for Hotel Operations in the First Quarter of 2023
SINGAPORE and SHANGHAI, China, April 25, 2023 (GLOBE NEWSWIRE) -- H World Group Limited (NASDAQ: HTHT and HKEX: 1179) (“H World”, “we” or “our”), a key player in the global hotel industry, today announced preliminary results for hotel operations in the first quarter (“Q1 2023”) ended March 31, 2023.
Business update
For our Legacy-Huazhu business, our RevPAR in Q1 2023 recovered to 118% of the 2019 level. Breaking down into monthly numbers, our RevPAR in January, February and March 2023 recovered to 96%, 140% and 120% of the 2019 levels, respectively. The strong recovery was primarily due to the pent-up demand in Q1 2023, and largely driven by ADR growth. During the quarter, a large part of our hotel closures were carried over from last year due to the impact of COVID-19. In line with our ‘Sustainable High Quality Growth’ strategy, we also conducted a round of thorough review of our existing pipeline and eliminated lower-quality pipeline hotels. This resulted in a quarter-over-quarter decline in the number of unopened hotels in pipeline. Our new hotel signings gained momentum quickly, reaching over 670 new hotels during the quarter, in tandem with the market recovery.
Steigenberger Hotels GmbH and its subsidiaries (“DH”, or “Legacy-DH”) continued with promising business recovery. Q1 2023 Blended RevPAR recovered to 94% of the 2019 levels mainly driven by ADR recovery.
Operating Results: Legacy-Huazhu(1)
| Number of hotels | Number of rooms | ||||||||
| Opened in Q1 2023 | Closed (2) in Q1 2023 | Net added in Q1 2023 | As of March 31, 2023 | As of March 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 of March 31, | For the quarter | yoy | For the quarter | yoy | For the quarter | yoy | |||||||||
| ended March 31, | change | ended March 31, | change | ended March 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 | Closed in Q1 2023 | Net added in Q1 2023 | As of March 31, 2023(4) | | As of March 31,2023 | | As of March 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). | |||||
About H World Group Limited
Originated 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 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.
Contact Information
Investor Relations
Tel: +86 (21) 6195 9561
Email: ir@hworld.com
https://ir.hworld.com
