Huazhu Group Limited Announces Preliminary Results for Hotel Operations in the Fourth Quarter and the Full Year of 2020
SHANGHAI, China, Jan. 22, 2021 (GLOBE NEWSWIRE) -- Huazhu Group Limited (NASDAQ: HTHT and HKEX: 1179) (“Huazhu”, “we” or “our”), a world-leading hotel group, today announced preliminary results for hotel operations in the fourth quarter (“Q4 2020”) and the full year ended December 31, 2020.
Recovery continued in Q4 2020
During Q4 2020, despite numerous recurrence of COVID-19 in several cities and provinces in mainland China, such as Shanghai, Chengdu, and Northeastern of China, our business continued to recover, thanks to China’s more effective and precise control of the COVID-19 pandemic. More importantly, we noticed that travelling demand shows resilience and recovery in previously affected cities started accelerating after adjusting down the risk level in those cities (from mid-to-high risk to low risk). Hence, in Q4 2020, Huazhu expects net revenues in China to be better than our previous guidance.
Steigenberger Hotels AG and its subsidiaries (“DH”) suffered from the second wave of COVID-19 outbreak in European countries since late September 2020. The lock down period in Germany extended to February 14, 2021. However, even with the extension of the lock down period, the Q4 2020 DH net revenues remains within our previous guidance. In addition, we are taking further cost and cash flow measures, such as negotiating with landlords to reduce our rental costs, reducing or eliminating discretionary corporate spending and capital expenditures, etc. We also actively sought new business opportunities in the government’s fight against COVID-19, such as offering hotels to support government for pandemic prevention and control.
Operating Results: Legacy-Huazhu(1)
| Number of hotels | Number of rooms | |||||||
| Opened in Q4 2020 | Closed (2) in Q4 2020 | Net added in Q4 2020 | As of December 31, 2020 (3) | As of December 31, 2020 | ||||
| Leased and owned hotels | 4 | (10) | (6) | 681 | 90,942 | |||
| Manachised and franchised hotels | 389 | (104) | 285 | 5,988 | 537,193 | |||
| Total | 393 | (114) | 279 | 6,669 | 628,135 | |||
| (1) Legacy-Huazhu refers to Huazhu and its subsidiaries, excluding DH. (2) The reasons for hotel closures mainly include non-compliance with our brand standards, operating losses, and property-related issues. In Q4 2020, we temporarily closed 6 hotels for brand upgrade and business model change purposes. (3) As of December 31, 2020, 74 hotels were requisitioned by governmental authorities. | ||||||||
| As of December 31, 2020 | ||
| Number of hotels | Unopened hotels in pipeline | |
| Economy hotels | 4,362 | 1,183 |
| Leased and owned hotels | 438 | 4 |
| Manachised and franchised hotels | 3,924 | 1,179 |
| Midscale and upscale hotels | 2,307 | 1,228 |
| Leased and owned hotels | 243 | 14 |
| Manachised and franchised hotels | 2,064 | 1,214 |
| Total | 6,669 | 2,411 |
| Operational hotels (excluding hotels under requisition) | |||||||||
| For the quarter ended | |||||||||
| December 31, | September 30, | December 31, | yoy | ||||||
| 2019 | 2020 | 2020 | change | ||||||
| Average daily room rate (in RMB) | |||||||||
| Leased and owned hotels | 277 | 255 | 272 | -1.8 | % | ||||
| Manachised and franchised hotels | 223 | 211 | 224 | 0.6 | % | ||||
| Blended | 232 | 218 | 231 | -0.5 | % | ||||
| Occupancy rate (as a percentage) | |||||||||
| Leased and owned hotels | 84.7 | % | 82.9 | % | 79.6 | % | -5.2p.p. | ||
| Manachised and franchised hotels | 81.6 | % | 81.8 | % | 80.8 | % | -0.9p.p. | ||
| Blended | 82.2 | % | 82.0 | % | 80.6 | % | -1.6p.p. | ||
| RevPAR (in RMB) | |||||||||
| Leased and owned hotels | 235 | 211 | 217 | -7.8 | % | ||||
| Manachised and franchised hotels | 182 | 173 | 181 | -0.5 | % | ||||
| Blended | 191 | 179 | 186 | -2.4 | % | ||||
| For the year ended | ||||||
| December 31, | December 31, | yoy | ||||
| 2019 | 2020 | change | ||||
| Average daily room rate (in RMB) | ||||||
| Leased and owned hotels | 276 | 241 | -12.8 | % | ||
| Manachised and franchised hotels | 224 | 204 | -8.9 | % | ||
| Blended | 234 | 210 | -10.3 | % | ||
| Occupancy rate (as a percentage) | ||||||
| Leased and owned hotels | 87.0 | % | 68.9 | % | -18.1p.p. | |
| Manachised and franchised hotels | 83.8 | % | 71.4 | % | -12.4p.p. | |
| Blended | 84.4 | % | 71.0 | % | -13.4p.p. | |
| RevPAR (in RMB) | ||||||
| Leased and owned hotels | 240 | 166 | -30.9 | % | ||
| Manachised and franchised hotels | 188 | 146 | -22.3 | % | ||
| Blended | 198 | 149 | -24.5 | % | ||
| Same-hotel operational data by class | ||||||||||||||||
| Mature hotels in operation for more than 18 months (excluding hotels under requisition) | ||||||||||||||||
| Number of hotels | Same-hotel RevPAR | Same-hotel ADR | Same-hotel Occupancy | |||||||||||||
| As of December 31, | For the quarter | yoy | For the quarter | yoy | For the quarter | yoy | ||||||||||
| ended December 31, | change | ended December 31, | change | ended December 31, | change | |||||||||||
| 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | (p.p.) | ||||||||
| Economy hotels | 2,651 | 2,651 | 162 | 151 | -6.7 | % | 185 | 178 | -3.7 | % | 87.6 | % | 84.9 | % | -2.7 | |
| Leased and owned hotels | 412 | 412 | 184 | 167 | -8.9 | % | 210 | 199 | -5.2 | % | 87.7 | % | 84.3 | % | -3.4 | |
| Manachised and franchised hotels | 2,239 | 2,239 | 157 | 147 | -6.1 | % | 179 | 173 | -3.3 | % | 87.5 | % | 85.0 | % | -2.5 | |
| Midscale and upscale hotels | 1,225 | 1,225 | 266 | 243 | -8.5 | % | 322 | 311 | -3.4 | % | 82.5 | % | 78.2 | % | -4.3 | |
| Leased and owned hotels | 190 | 190 | 327 | 272 | -16.7 | % | 392 | 365 | -6.8 | % | 83.4 | % | 74.5 | % | -8.8 | |
| Manachised and franchised hotels | 1,035 | 1,035 | 250 | 236 | -5.6 | % | 303 | 298 | -1.9 | % | 82.3 | % | 79.2 | % | -3.1 | |
| Total | 3,876 | 3,876 | 201 | 186 | -7.6 | % | 235 | 225 | -3.9 | % | 85.7 | % | 82.4 | % | -3.3 | |
| Number of hotels | Same-hotel RevPAR | Same-hotel ADR | Same-hotel Occupancy | |||||||||||||
| As of December 31, | For the year | yoy | For the year | yoy | For the year | yoy | ||||||||||
| ended December 31, | change | ended December 31, | change | ended December 31, | change | |||||||||||
| 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | (p.p.) | ||||||||
| Economy hotels | 2,651 | 2,651 | 169 | 121 | -28.8 | % | 189 | 162 | -14.1 | % | 89.7 | % | 74.3 | % | -15.4 | |
| Leased and owned hotels | 412 | 412 | 191 | 128 | -32.8 | % | 211 | 176 | -16.4 | % | 90.5 | % | 72.8 | % | -17.7 | |
| Manachised and franchised hotels | 2,239 | 2,239 | 164 | 118 | -27.7 | % | 183 | 159 | -13.4 | % | 89.4 | % | 74.7 | % | -14.8 | |
| Midscale and upscale hotels | 1,225 | 1,225 | 272 | 198 | -27.0 | % | 328 | 287 | -12.4 | % | 82.8 | % | 69.0 | % | -13.8 | |
| Leased and owned hotels | 190 | 190 | 332 | 211 | -36.4 | % | 395 | 328 | -17.0 | % | 84.1 | % | 64.5 | % | -19.7 | |
| Manachised and franchised hotels | 1,035 | 1,035 | 254 | 194 | -23.4 | % | 308 | 276 | -10.3 | % | 82.5 | % | 70.4 | % | -12.1 | |
| Total | 3,876 | 3,876 | 205 | 148 | -27.9 | % | 234 | 204 | -13.1 | % | 87.3 | % | 72.5 | % | -14.8 | |
Operating Results: Legacy-DH(4)
| Number of hotels | Number of rooms | Unopened hotels in pipeline | ||||||
| Opened in Q4 2020 | Closed in Q4 2020 | Net added in Q4 2020 | As of December 31, 2020(5) | | As of December 31, 2020 | | As of December 31, 2020 | |
| Leased hotels | 2 | - | 2 | 72 | 13,371 | 26 | ||
| Manachised and franchised hotels | 1 | - | 1 | 48 | 10,656 | 12 | ||
| Total | 3 | - | 3 | 120 | 24,027 | 38 | ||
| (4) Legacy-DH refers to DH. (5) As of December 31, 2020, a total of 18 DH brand hotels were temporarily closed due to COVID-19. | ||||||||
| For the quarter ended | ||||||||
| December 31, | September 30, | December 31, | yoy | |||||
| 2019 | 2020 | 2020 | change | |||||
| Average daily room rate (in EUR) | ||||||||
| Leased hotels | 108 | 88 | 78 | -27.2 | % | |||
| Manachised and franchised hotels | 85 | 101 | 73 | -13.7 | % | |||
| Blended | 97 | 93 | 76 | -21.5 | % | |||
| Occupancy rate (as a percentage) | ||||||||
| Leased hotels | 73.3 | % | 38.2 | % | 20.9 | % | -52.6p.p. | |
| Manachised and franchised hotels | 62.6 | % | 37.5 | % | 25.4 | % | -37.2p.p. | |
| Blended | 68.0 | % | 37.9 | % | 22.5 | % | -45.5p.p. | |
| RevPAR (in EUR) | ||||||||
| Leased hotels | 79 | 34 | 16 | -79.3 | % | |||
| Manachised and franchised hotels | 53 | 38 | 19 | -64.9 | % | |||
| Blended | 66 | 35 | 17 | -74.0 | % | |||
| For the year ended | ||||||
| December 31, | December 31, | yoy | ||||
| 2019 | 2020 | change | ||||
| Average daily room rate (in EUR) | ||||||
| Leased hotels | 105 | 89 | -14.8 | % | ||
| Manachised and franchised hotels | 88 | 85 | -3.2 | % | ||
| Blended | 97 | 88 | -9.9 | % | ||
| Occupancy rate (as a percentage) | ||||||
| Leased hotels | 72.8 | % | 33.9 | % | -38.9p.p. | |
| Manachised and franchised hotels | 65.0 | % | 36.3 | % | -28.7p.p. | |
| Blended | 69.1 | % | 34.8 | % | -34.3p.p. | |
| RevPAR (in EUR) | ||||||
| Leased hotels | 76 | 30 | -60.4 | % | ||
| Manachised and franchised hotels | 57 | 31 | -45.8 | % | ||
| Blended | 67 | 31 | -54.6 | % | ||
Hotel Portfolio by Brand
| As of December 31, 2020 | |||
| Hotels | Rooms | Unopened hotels | |
| in operation | in pipeline | ||
| Economy hotels | 4,376 | 361,435 | 1,192 |
| HanTing Hotel | 2,780 | 254,106 | 597 |
| Hi Inn | 439 | 25,282 | 91 |
| Elan Hotel(6) | 938 | 58,753 | 448 |
| Ibis Hotel | 205 | 21,633 | 47 |
| Zleep Hotel | 14 | 1,661 | 9 |
| Midscale and upscale hotels | 2,413 | 290,727 | 1,257 |
| Ibis Styles Hotel | 69 | 7,992 | 22 |
| Starway Hotel | 455 | 38,657 | 252 |
| JI Hotel | 1,105 | 135,737 | 512 |
| Orange Hotel | 320 | 36,167 | 174 |
| Crystal Orange Hotel | 114 | 15,400 | 66 |
| Manxin Hotel | 61 | 6,009 | 47 |
| Madison Hotel | 22 | 2,950 | 42 |
| Mercure Hotel | 104 | 17,486 | 61 |
| Novotel Hotel | 12 | 3,387 | 14 |
| Joya Hotel | 10 | 1,842 | - |
| Blossom House | 28 | 1,249 | 23 |
| Grand Mercure Hotel | 7 | 1,485 | 7 |
| Steigenberger Hotels & Resorts | 49 | 11,574 | 7 |
| IntercityHotel(7) | 45 | 8,056 | 23 |
| Maxx by Steigenberger(8) | 5 | 777 | 4 |
| Jaz in the City | 2 | 424 | 2 |
| Other partner hotels | 5 | 1,535 | 1 |
| Total | 6,789 | 652,162 | 2,449 |
| (6) As of December 31, 2020, 5 Ni Hao Hotels were included in the operational hotel total for Elan Hotels and 74 Ni Hao hotels were included in the pipeline total for Elan Hotels. (7) As of December 31, 2020, 5 pipeline hotels of IntercityHotel were in China. (8) As of December 31, 2020, 3 pipeline hotels of Maxx by Steigenberger were in China. | |||
About Huazhu Group Limited
Originated in China, Huazhu Group Limited is a world-leading hotel group. As of December 31, 2020, Huazhu operated 6,789 hotels with 652,162 rooms in operation in 16 countries. Huazhu’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, and Ni Hao Hotel. Upon the completion of the acquisition of DH on January 2, 2020, Huazhu added five brands to its portfolio, including Steigenberger Hotels & Resorts, Maxx by Steigenberger, Jaz in the City, IntercityHotel and Zleep Hotel. In addition, Huazhu 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.
Huazhu’s business includes leased and owned, manachised and franchised models. Under the lease and ownership model, Huazhu directly operates hotels typically located on leased or owned properties. Under the manachise model, Huazhu manages manachised hotels through the on-site hotel managers that Huazhu appoints, and Huazhu collects fees from franchisees. Under the franchise model, Huazhu provides training, reservations and support services to the franchised hotels, and collects fees from franchisees but does not appoint on-site hotel managers. Huazhu applies a consistent standard and platform across all of its hotels. As of December 31, 2020, Huazhu operates 16 percent of its hotel rooms under lease and ownership model, and 84 percent under manachise and franchise models.
For more information, please visit Huazhu’s website: http://ir.huazhu.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.
Huazhu 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
Huazhu Investor Relations
Tel: 86 (21) 6195 9561
Email: ir@huazhu.com
http://ir.huazhu.com