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 November 2022

 

Commission File Number: 001-34656

 

H World Group Limited

(Registrant’s name)

 

No. 1299 Fenghua Road

Jiading District

Shanghai
People’s Republic of China
(86) 21 6195-2011

(Address of principal executive office)

 

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): ¨

 

 

 

EXHIBIT INDEX

 

Exhibit Number		Description
Exhibit 99.1		H World Group Limited Reports Third Quarter of 2022 Unaudited Financial Results

 

 

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.

 

		H World Group Limited
		(Registrant)
Date: November 28, 2022	By:	/s/ Qi Ji
	Name:	Qi Ji
	Title:	Executive Chairman of the Board of Directors

  

 

 

Exhibit 99.1

 

 

 

Contact Information 

Investor Relations 

Tel: +86 (21) 6195 9561 

Email: ir@hworld.com 

https://ir.hworld.com

 

H World Group Limited Reports Third Quarter of 2022 Unaudited Financial Results

 

·

A total of 8,402 hotels or 797,489 hotel rooms in operation as of September 30, 2022.

 

·

Hotel turnover1 increased 24.4% year-over-year to RMB15.2 billion in the third quarter of 2022. Excluding Steigenberger Hotels AG and its subsidiaries (“DH”, or “Legacy-DH”), hotel turnover increased 21.6% year-over-year in the third quarter of 2022.

 

·

Revenue increased 16.2% year-over-year to RMB4.1 billion (US$575 million)2 in the third quarter of 2022, in line with the revenue guidance previously announced of a 13% to 17% increase compared to the third quarter of 2021. Revenue from the Legacy-Huazhu segment in the third quarter of 2022 increased 7.7% year-over-year, in line with revenue guidance previously announced of a 5% to 9% increase.

 

·

Net loss attributable to H World Group Limited was RMB717 million (US$101 million) in the third quarter of 2022, compared with RMB137 million in the third quarter of 2021 and RMB350 million in the previous quarter. Net loss attributable to H World Group Limited from the Legacy-Huazhu segment was RMB731 million in the third quarter of 2022, compared with net income attributable to H World Group Limited from the Legacy-Huazhu segment of RMB27 million in the third quarter of 2021 and net loss attributable to H World Group Limited from the Legacy-Huazhu segment of RMB298 million in the previous quarter.

 

·

EBITDA (non-GAAP) in the third quarter of 2022 was RMB149 million (US$21 million), compared with RMB294 million in the third quarter of 2021 and negative RMB213 million in the previous quarter. EBITDA from the Legacy-Huazhu segment, which is a segment measure, was RMB55 million in the third quarter of 2022, compared with RMB409 million in the third quarter of 2021 and negative RMB243 million in the previous quarter.

 

·

Adjusted EBITDA (non-GAAP), which excluded share-based compensation expenses and unrealized gains (losses) from fair value changes of equity securities, was RMB491 million (US$69 million) in the third quarter of 2022, compared with RMB385 million in the third quarter of 2021 and RMB53 million in the previous quarter. Adjusted EBITDA from the Legacy-Huazhu segment (non-GAAP) was RMB397 million in the third quarter of 2022, compared with RMB500 million in the third quarter of 2021 and RMB23 million in the previous quarter.

 

·

In the fourth quarter of 2022, H World expects revenue to increase 7% to 11% compared to the fourth quarter of 2021, or to decrease 1% to 5% if excluding DH.

 

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=RMB7.1135 on September 30, 2022 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.

 

 

 

 

Shanghai, China, November 28, 2022 – 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 in the third quarter ended September 30, 2022.

 

As of September 30, 2022, H World’s worldwide hotel network in operation totaled 8,402 hotels and 797,489 rooms, including 126 hotels from DH. During the third quarter of 2022, our Legacy-Huazhu business opened 429 hotels, including 4 leased (or leased-and-operated) hotels and 425 manachised (or franchised-and-managed) hotels and franchised hotels, and closed a total of 204 hotels, including 19 leased hotels and 185 manachised and franchised hotels. During the third quarter of 2022, the Legacy-DH business opened 1 manachised and franchised hotel. As of September 30, 2022, H World had a total of 2,313 unopened hotels in our pipeline, including 2,274 hotels from the Legacy-Huazhu business and 39 hotels from the Legacy-DH business.

 

Legacy-Huazhu Only – Third Quarter of 2022 Operational Highlights

 

As of September 30, 2022, Legacy-Huazhu had 8,276 hotels in operation, including 631 leased and owned hotels, and 7,645 manachised and franchised hotels. In addition, as of the same date, Legacy-Huazhu had 772,227 hotel rooms in operation, including 90,034 rooms under the lease and ownership model, and 682,193 rooms under the manachise and franchise models. Legacy-Huazhu also had 2,274 unopened hotels in its pipeline, including 17 leased and owned hotels, and 2,257 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 (excluding hotels under governmental requisition) for the periods indicated.

 

· The ADR was RMB254 in the third quarter of 2022, compared with RMB246 in the third quarter of 2021, RMB218 in the previous quarter, and RMB245 in the third quarter of 2019.

 

· The occupancy rate for all the Legacy-Huazhu hotels in operation was 76.0% in the third quarter of 2022, compared with 71.9% in the third quarter of 2021, 64.6% in the previous quarter, and 87.7% in the third quarter of 2019.

 

· Blended RevPAR was RMB193 in the third quarter of 2022, compared with RMB177 in the third quarter of 2021, RMB141 in the previous quarter, and RMB215 in the third quarter of 2019.

 

· For all the Legacy-Huazhu hotels which had been in operation for at least 18 months, the same-hotel RevPAR was RMB190 in the third quarter of 2022, representing a 3.9% increase from RMB183 in the third quarter of 2021, with a 0.2% decrease in ADR and an 3.0-percentage-point increase in occupancy rate; comparing the third quarter of 2022 with the pre-COVID third quarter of 2019, same-hotel RevPAR represented a 21.6% decrease from RMB230 in the third quarter of 2019, with a 6.9% decrease in ADR, and a 14.4-percentage-point decrease in occupancy rate.

 

 

 

 

Legacy-DH Only – Third Quarter of 2022 Operational Highlights

 

As of September 30, 2022, Legacy-DH had 126 hotels in operation, including 79 leased and owned hotels and 47 manachised and franchised hotels. In addition, as of the same date, Legacy-DH had 25,262 hotel rooms in operation, including 14,939 rooms under the lease and ownership model, and 10,323 rooms under the manachise and franchise models. Legacy-DH also had unopened 39 hotels in our pipeline, including 27 leased and owned hotels and 12 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 EUR114 in the third quarter of 2022, compared with EUR99 in the third quarter of 2021 and EUR110 in the previous quarter.

 

· The occupancy rate for all Legacy-DH hotels in operation was 66.1% in the third quarter of 2022, compared with 48.6% in the third quarter of 2021 and 59.8% in the previous quarter.

 

· Blended RevPAR was EUR75 in the third quarter of 2022, compared with EUR48 in the third quarter of 2021 and EUR66 in the previous quarter.

 

Jin Hui, CEO of H World commented: “During the third quarter of 2022, our RevPAR recovered to 90% of the 2019 level, thanks to the pent-up leisure travel demand in the summer holiday during July and August 2022, as well as a gradual recovery of business travel in late September 2022. However, given more sporadic resurgences of COVID in various Chinese cities and provinces since early October, our October RevPAR recovery slowed down to only 74% of 2019 level. Although we have been seeing COVID prevention measures gradually easing across China since early November, we remain cautious on the business recovery path in the near-term as there are still some of newly confirmed recent cases in many cities and provinces in China. Therefore, our near-term focus will remain on cost control and prudent capex spending to ensure the Company’s operational and cash flow safety. More importantly, we are continuously optimizing our organizational structure and improving hotel and service quality to further strengthen our long-term core competencies, which is the critical foundation for us to achieve our long-term ‘Sustainable Quality Growth’ strategy.”

 

“In Europe, the DH business further improved in the third quarter with RevPAR recovering to 102% of the 2019 level, from 93% in the second quarter. The recovery was mainly driven by 17% ADR growth. This upward trend continued in October. However, against the background of surging inflation in Europe due to energy shortages, cash flow improvement program remains critical. Therefore, DH’s near-term focus will remain on efficiency improvements, renegotiation of further lease waivers, and personnel cost optimization.”

 

 

 

 

Third Quarter of 2022 Unaudited Financial Results

 

(RMB in millions)		Q3 2021				Q2 2022				Q3 2022
Revenue:
Leased and owned hotels			2,345				2,361				2,695
Manachised and franchised hotels			1,128				945				1,313
Others			50				76				85
Total revenue			3,523				3,382				4,093

 

Revenue in the third quarter of 2022 was RMB4.1 billion (US$575 million), representing a 16.2% year-over-year increase and a 21.0% sequential increase. Revenue from the Legacy-Huazhu segment in the third quarter of 2022 was RMB3.2 billion, representing a 7.7% year-over-year increase and a 28.4% sequential increase. The increase was mainly due to business recovery in China which was supported by pent-up leisure demand in the summer holiday during July and August 2022, as well as a gradual recovery of business travel in late September 2022. Revenue from the Legacy-DH segment in the third quarter of 2022 was RMB932 million, representing a 58.2% year-over-year increase and a 1.2% sequential increase. The increase was mainly due to the robust recovery of our European business since Europe’s opening-up starting from mid-February.

 

Revenue from leased and owned hotels in the third quarter of 2022 was RMB2.7 billion (US$379 million), representing a 14.9% year-over-year increase and a 14.1% sequential increase. Revenue from leased and owned hotels from the Legacy-Huazhu segment in the third quarter of 2022 was RMB1.8 billion, representing a 0.5% year-over-year increase. Revenue from leased and owned hotels from the Legacy-DH segment in the third quarter of 2022 was RMB902 million, representing a 60.8% year-over-year increase.

 

Revenue from manachised and franchised hotels in the third quarter of 2022 was RMB1.3 billion (US$185 million), representing a 16.4% year-over-year increase and a 38.9% sequential increase. Revenue from our Legacy-Huazhu segment from manachised and franchised hotels in the third quarter of 2022 was RMB1.3 billion, representing a 16.3% year-over-year increase. Revenue from manachised and franchised hotels from the Legacy-DH segment in the third quarter of 2022 was RMB22 million, representing a 22.2% 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 business, totaling RMB85 million (US$11 million) in the third quarter of 2022, compared to RMB50 million in the third quarter of 2021 and RMB76 million in the previous quarter.

 

 

 

 

(RMB in millions)		Q3 2021				Q2 2022				Q3 2022
Operating costs and expenses:
Hotel operating costs			(2,885	)			(2,972	)			(3,045	)
Other operating costs			(14	)			(15	)			(13	)
Selling and marketing expenses			(189	)			(142	)			(181	)
General and administrative expenses			(388	)			(368	)			(405	)
Pre-opening expenses			(15	)			(31	)			(25	)
Total operating costs and expenses			(3,491	)			(3,528	)			(3,669	)

 

Hotel operating costs in the third quarter of 2022 were RMB3.0 billion (US$428 million), compared to RMB2.9 billion in the third quarter of 2021 and RMB3.0 billion in the previous quarter. The year-over-year increase was mainly due to continued hotel network expansion of Legacy-Huazhu, and business recovery of Legacy-DH. Hotel operating costs from the Legacy-Huazhu segment in the third quarter of 2022 were RMB2.3 billion, which represented 72.8% of the quarter’s revenue, compared to RMB2.3 billion or 76.9% of revenue in the third quarter in 2021 and RMB2.2 billion or 88.1% of revenue for the previous quarter. In the third quarter of 2022, Legacy-Huazhu continued to conduct our cost control measures and achieved rental reduction of RMB132 million.

 

Selling and marketing expenses in the third quarter of 2022 were RMB181 million (US$26 million), compared to RMB189 million in the third quarter of 2021 and RMB142 million in the previous quarter. Selling and marketing expenses from the Legacy-Huazhu segment in the third quarter of 2022 were RMB105 million, which represented 3.3% of the quarter’s revenue, compared to RMB129 million or 4.4% of revenue in the third quarter in 2021, and RMB65 million or 2.6% of revenue for the previous quarter.

 

General and administrative expenses in the third quarter of 2022 were RMB405 million (US$57 million), compared to RMB388 million in the third quarter of 2021 and RMB368 million in the previous quarter. General and administrative expenses from the Legacy-Huazhu segment in the third quarter of 2022 were RMB330 million, which represented 10.4% of the quarter’s revenue, compared to RMB306 million or 10.4% in the third quarter in 2021 and RMB267 million or 10.8% for the previous quarter. The increase was mainly due to the resumption of normal operations at our Shanghai headquarter.

 

Pre-opening expenses in the third quarter of 2022 were mostly related to the Legacy-Huazhu segment and totaled RMB25 million (US$3 million), compared to RMB15 million in the third quarter of 2021 and RMB31 million in the previous quarter.

 

Other operating income, net in the third quarter of 2022 was RMB76 million (US$11 million), compared to RMB40 million in the third quarter of 2021 and RMB154 million in the previous quarter.

 

Income from operations in the third quarter of 2022 was RMB500 million (US$70 million), compared to RMB72 million in the third quarter of 2021 and RMB8 million in the previous quarter. Income from operations from the Legacy-Huazhu segment in the third quarter of 2022 was RMB449 million, compared to income from operations from the Legacy-Huazhu segment of RMB239 million in the third quarter of 2021 and RMB21 million in the previous quarter. Income from operations from the Legacy-DH segment in the third quarter of 2022 was RMB51 million, compared to a loss from operations of RMB167 million in the third quarter of 2021 and a loss from operations of RMB13 million in the previous quarter.

 

 

 

 

Operating margin, defined as income from operations as a percentage of revenues, in the third quarter of 2022 was 12.2%, compared with 2.0% in the third quarter of 2021 and 0.2% for the previous quarter. Operating margin from the Legacy-Huazhu segment in the third quarter of 2022 was 14.2%, compared with 8.1% in the third quarter of 2021 and 0.9% in the previous quarter.

 

Other expense, net in the third quarter of 2022 was RMB14 million (US$2 million), compared to other income, net of RMB4 million in the third quarter of 2021 and other income, net of RMB29 million for the previous quarter.

 

Unrealized losses from fair value changes of equity securities in the third quarter of 2022 were RMB313 million (US$44 million), compared to unrealized losses from fair value changes of equity securities of RMB60 million in the third quarter of 2021, and unrealized losses from fair value changes of RMB240 million in the previous quarter. Unrealized 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.

 

Income tax expense in the third quarter of 2022 was RMB434 million (US$61 million), compared to income tax benefit of RMB13 million in the third quarter of 2021 and income tax benefit of RMB299 million in the previous quarter.

 

Net loss attributable to H World Group Limited in the third quarter of 2022 was RMB717 million (US$101 million), compared to RMB137 million in the third quarter of 2021 and RMB350 million in the previous quarter. Net loss attributable to H World Group Limited from the Legacy-Huazhu segment in the third quarter of 2022 was RMB731 million, compared to net income attributable to H World Group Limited from the Legacy-Huazhu segment of RMB27 million in the third quarter of 2021 and a net loss attributable to H World Group Limited from the Legacy-Huazhu segment of RMB298 million in the previous quarter.

 

Basic and diluted losses per share/American depositary share (ADS). In the third quarter of 2022, basic and diluted losses per share were RMB0.23 (US$0.03). Adjusted basic and diluted losses per share (non-GAAP), which excluded share-based compensation expenses and unrealized gains (losses) from fair value changes of equity securities, were RMB0.12 (US$0.02). Basic and diluted losses per ADS were RMB2.31 (US$0.32). Adjusted basic and diluted losses per ADS (non-GAAP), which excluded share-based compensation expenses and unrealized gains (losses) from fair value changes of equity securities, were RMB1.21 (US$0.17).

 

 

 

 

EBITDA (non-GAAP) in the third quarter of 2022 was RMB149 million (US$21 million), compared with RMB294 million in the third quarter of 2021 and negative RMB213 million in the previous quarter. EBITDA from the Legacy-Huazhu segment in the third quarter of 2022 was RMB55 million, compared with RMB409 million in the third quarter of 2021 and negative RMB243 million in the previous quarter. Adjusted EBITDA (non-GAAP), which excluded share-based compensation expenses and unrealized gains (losses) from fair value changes of equity securities, in the third quarter of 2022 was RMB491 million (US$69 million), compared with RMB385 million in the third quarter of 2021 and RMB53 million in the previous quarter. The adjusted EBITDA from the Legacy-Huazhu segment (non-GAAP) in the third quarter of 2022 was RMB397 million, compared with RMB500 million in the third quarter of 2021 and RMB23 million in the previous quarter.

 

Cash flow. Operating cash inflow in the third quarter of 2022 was RMB452 million (US$64 million). Investing cash outflow in the third quarter of 2022 was RMB525 million (US$74 million). Financing cash inflow in the third quarter of 2022 was RMB461 million (US$65 million).

 

Cash and cash equivalents and Restricted cash. As of September 30, 2022, the Company had a total balance of cash and cash equivalents of RMB5.2 billion (US$728 million) and restricted cash of RMB40 million (US$6 million).

 

Debt financing. As of September 30, 2022, the Company had a total debt balance of RMB11.2 billion (US$1.6 billion) and the unutilized credit facility available to the Company was RMB2.9 billion. Recently, we have successfully redeemed our convertible note with a total amount of US$475 million.

 

COVID update

 

For our Legacy-Huazhu business, our RevPAR in Q3 2022 recovered to 90% of the 2019 level, thanks to the pent-up leisure travel demand in the summer holiday during July and August 2022, as well as a gradual recovery of business travel in late September 2022. Breaking down into each month, our RevPAR in July, August and September 2022 recovered to 90%, 89% and 90% of the 2019 levels, respectively. However, we remain cautious on the recovery path in Q4 2022 as we are seeing more recent sporadic resurgences of COVID in various provinces and cities across China.

 

Steigenberger Hotels AG and its subsidiaries have experienced continuing RevPAR recovery in Q3 2022. After recovering to 93% of 2019 levels in Q2 2022, blended RevPAR increased to 102% of 2019 levels in Q3 2022. Blended RevPAR recovery was driven by a 17% increase in ADR, while occupancy remained 10 percentage points behind 2019 levels. Energy crisis and inflation in Europe is expected to continue, further ADR increases will be therefore required. At same time, focus of DH will continue to be on efficiency improvements, negotiation of lease contract adjustment, and cost optimization.

 

 

 

 

Guidance

 

Since March 2022, the highly infectious Omicron variant has been spreading rapidly in China which has seriously affected our near-term business performance. In addition, the current COVID prevention policy has rendered business performance more unpredictable for the foreseeable future. Nevertheless, we will continue to provide quarterly guidance based on our best understanding of the most recent situation.

 

In the fourth quarter of 2022, H World expects revenue to increase 7% to 11% compared to the fourth quarter of 2021, or to decrease 1% to 5% if excluding DH.

 

The above forecast reflects the Company’s current and preliminary view, which is subject to change.

 

Conference Call

 

H World’s management will host a conference call at 8 p.m. (U.S. Eastern time) on Monday, November 28, 2022 (or 9 a.m. (Hong Kong time) on Tuesday, November 29, 2022) 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/BI0ae7c3a955d34ca680b2c55589a22668. 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/226f8gsn 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 Measures

 

To 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 unrealized gains (losses) from fair value changes of equity securities; adjusted basic and diluted earnings (losses) per share/ADS excluding share-based compensation expenses and unrealized 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 unrealized 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 unrealized 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 unrealized gains (losses) from fair value changes of equity securities is that share-based compensation expenses and unrealized gains (losses) from fair value changes of equity securities have been and will 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 unrealized 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 unrealized 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 unrealized gains (losses) from fair value changes of equity securities may not be indicative of Company operating performance.

 

The Company believes that unrealized gains and losses from changes in fair value of equity securities are generally meaningless in understanding the Company’s reported results or evaluating the economic performance of its businesses. These gains and losses have caused and will continue to cause significant volatility in reported periodic earnings.

 

 

 

 

Therefore, the Company believes adjusted EBITDA more closely reflects the 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 unrealized 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 unrealized 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 Limited

 

Originated in China, H World Group Limited is a key player in the global hotel industry. As of September 30, 2022, H World operated 8,402 hotels with 797,489 rooms in operation in 17 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 September 30, 2022, 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.

 

—Financial Tables and Operational Data Follow—

 

 

 

H World Group Limited 

Unaudited Condensed Consolidated Balance Sheets

 

		December 31, 2021				September 30, 2022
		RMB				RMB				US$3
						(in millions)
ASSETS
Current assets:
Cash and cash equivalents			5,116				5,177				728
Restricted cash			25				40				6
Short-term investments			2,589				1,915				269
Accounts receivable, net			521				1,231				173
Loan receivables, net			218				161				23
Amounts due from related parties			149				177				25
Inventories			88				83				12
Other current assets, net			847				779				109
Total current assets			9,553				9,563				1,345
Property and equipment, net			7,056				6,804				957
Intangible assets, net			5,385				5,240				737
Operating lease right-of-use assets			29,942				28,610				4,022
Finance lease right-of-use assets			2,235				2,372				333
Land use rights, net			206				201				28
Long-term investments			1,965				1,865				262
Goodwill			5,132				5,069				713
Amounts due from related parties, non-current			1				6				1
Loan receivables, net			98				115				16
Other assets, net			834				696				98
Deferred tax assets			862				846				119
Total assets			63,269				61,387				8,631
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt			6,232				5,144				723
Accounts payable			968				810				114
Amounts due to related parties			197				85				12
Salary and welfare payables			591				459				64
Deferred revenue			1,366				1,280				180
Operating lease liabilities, current			3,628				3,732				525
Finance lease liabilities, current			41				45				6
Accrued expenses and other current liabilities			1,838				2,054				289
Income tax payable			418				126				18
Total current liabilities			15,279				13,735				1,931
Long-term debt			3,565				6,091				856
Operating lease liabilities, non-current			28,012				27,216				3,826
Finance lease liabilities, non-current			2,684				2,857				402
Deferred revenue			785				822				116
Other long-term liabilities			903				967				136
Deferred tax liabilities			853				798				112
Retirement benefit obligations			144				138				19
Total liabilities			52,225				52,624				7,398
Equity:
Ordinary shares			0				0				0
Treasury shares			(107	)			(441	)			(62	)
Additional paid-in capital			9,964				10,127				1,424
Retained earnings			1,037				(1,076	)			(151	)
Accumulated other comprehensive income			41				70				10
Total H World Group Limited shareholders' equity			10,935				8,680				1,221
Noncontrolling interest			109				83				12
Total equity			11,044				8,763				1,233
Total liabilities and equity			63,269				61,387				8,631

 

³ The conversion of Renminbi (“RMB”) into United States dollars (“US$”) is based on the exchange rate of US$1.00=RMB7.1135 on September 30, 2022 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.

 

 

 

H World Group Limited

Unaudited Condensed Consolidated Statements of Comprehensive Income

 

		Quarter Ended
		September 30, 2021				June 30, 2022				September 30, 2022
		RMB				RMB				RMB				US$
		(in millions, except share, per share and per ADS data)
Revenues:
Leased and owned hotels			2,345				2,361				2,695				379
Manachised and franchised hotels			1,128				945				1,313				185
Others			50				76				85				11
Total revenues			3,523				3,382				4,093				575
Operating costs and expenses:
Hotel operating costs:
Rents			(1,009	)			(1,012	)			(935	)			(131	)
Utilities			(137	)			(123	)			(163	)			(23	)
Personnel costs			(793	)			(899	)			(964	)			(136	)
Depreciation and amortization			(356	)			(355	)			(351	)			(49	)
Consumables, food and beverage			(264	)			(245	)			(286	)			(40	)
Others			(326	)			(338	)			(346	)			(49	)
Total hotel operating costs			(2,885	)			(2,972	)			(3,045	)			(428	)
Other operating costs			(14	)			(15	)			(13	)			(2	)
Selling and marketing expenses			(189	)			(142	)			(181	)			(26	)
General and administrative expenses			(388	)			(368	)			(405	)			(57	)
Pre-opening expenses			(15	)			(31	)			(25	)			(3	)
Total operating costs and expenses			(3,491	)			(3,528	)			(3,669	)			(516	)
Other operating income (expense), net			40				154				76				11
Income (losses) from operations			72				8				500				70
Interest income			25				19				23				3
Interest expense			(101	)			(90	)			(93	)			(13	)
Other (expense) income, net			4				29				(14	)			(2	)
Unrealized gains (losses) from fair value changes of equity securities			(60	)			(240	)			(313	)			(44	)
Foreign exchange gain (loss)			(92	)			(402	)			(359	)			(50	)
Income (loss) before income taxes			(152	)			(676	)			(256	)			(36	)
Income tax (expense) benefit			13				299				(434	)			(61	)
Income (loss) from equity method investments			3				14				(20	)			(3	)
Net income (loss)			(136	)			(363	)			(710	)			(100	)
Net (income) loss attributable to noncontrolling interest			(1	)			13				(7	)			(1	)
Net income (loss) attributable to H World Group Limited			(137	)			(350	)			(717	)			(101	)
Other comprehensive income
Gain arising from defined benefit plan, net of tax			1				(0	)			-				-
Foreign currency translation adjustments, net of tax			(28	)			26				7				1
Comprehensive income (loss)			(163	)			(337	)			(703	)			(99	)
Comprehensive (income) loss attributable to noncontrolling interest			(1	)			13				(7	)			(1	)
Comprehensive income (loss) attributable to H World Group Limited			(164	)			(324	)			(710	)			(100	)
Earnings (losses) per share:
Basic			(0.04	)			(0.11	)			(0.23	)			(0.03	)
Diluted			(0.04	)			(0.11	)			(0.23	)			(0.03	)
Earnings (losses) per ADS:
Basic			(0.44	)			(1.13	)			(2.31	)			(0.32	)
Diluted			(0.44	)			(1.13	)			(2.31	)			(0.32	)
Weighted average number of shares used in computation:
Basic			3,115,104,798				3,108,693,946				3,107,798,883				3,107,798,883
Diluted			3,115,104,798				3,108,693,946				3,107,798,883				3,107,798,883

 

 

 

H World Group Limited

Unaudited Condensed Consolidated Statements of Cash Flows

 

		Quarter Ended
		September 30, 2021				June 30, 2022				September 30, 2022
		RMB				RMB				RMB				US$
		(in millions)
Operating activities:
Net income (loss)			(136	)			(363	)			(710	)			(100	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Share-based compensation			31				26				29				4
Depreciation and amortization, and other			383				374				370				52
Impairment loss			51				91				10				1
Loss from equity method investments, net of dividends			1				(14	)			22				3
Investment (income) loss			135				531				550				78
Changes in operating assets and liabilities			(305	)			(135	)			182				26
Other			32				479				(1	)			(0	)
Net cash provided by (used in) operating activities			192				989				452				64
Investing activities:
Capital expenditures			(346	)			(143	)			(256	)			(36	)
Acquisitions, net of cash received			(395	)			(3	)			0				0
Purchase of investments			(303	)			(0	)			(300	)			(42	)
Proceeds from maturity/sale of investments			-				186				6				1
Loan advances			(32	)			(49	)			(29	)			(4	)
Loan collections			41				65				52				7
Other			4				0				2				0
Net cash provided by (used in) investing activities			(1,031	)			56				(525	)			(74	)
Financing activities:
Payment of share repurchase			-				(143	)			-				-
Proceeds from debt			491				283				3,721				523
Payment of debt			(497	)			(313	)			(3,336	)			(469	)
Dividend paid			-				(416	)			-				-
Other			(11	)			(12	)			76				11
Net cash provided by (used in) financing activities			(17	)			(601	)			461				65
Effect of exchange rate changes on cash, cash equivalents and restricted cash			9				87				149				21
Net increase (decrease) in cash, cash equivalents and restricted cash			(847	)			531				537				76
Cash, cash equivalents and restricted cash at the beginning of the period			6,258				4,149				4,680				658
Cash, cash equivalents and restricted cash at the end of the period			5,411				4,680				5,217				734

 

 

 

H World Group Limited

Unaudited Reconciliation of GAAP and Non-GAAP Results

 

		Quarter Ended
		September 30, 2021				June 30, 2022				September 30, 2022
		RMB				RMB				RMB				US$
		(in millions, except shares, per share and per ADS data)
Net income (loss) attributable to H World Group Limited (GAAP)			(137	)			(350	)			(717	)			(101	)
Share-based compensation expenses			31				26				29				4
Unrealized (gains) losses from fair value changes of equity securities			60				240				313				44
Adjusted net income (loss) attributable to H World Group Limited (non-GAAP)			(46	)			(84	)			(375	)			(53	)
Adjusted earnings (losses) per share (non-GAAP)
Basic			(0.01	)			(0.03	)			(0.12	)			(0.02	)
Diluted			(0.01	)			(0.03	)			(0.12	)			(0.02	)
Adjusted earnings (losses) per ADS (non-GAAP)
Basic			(0.15	)			(0.27	)			(1.21	)			(0.17	)
Diluted			(0.15	)			(0.27	)			(1.21	)			(0.17	)
Weighted average number of shares used in computation (Non-GAAP)
Basic			3,115,104,798				3,108,693,946				3,107,798,883				3,107,798,883
Diluted			3,115,104,798				3,108,693,946				3,107,798,883				3,107,798,883

 

		Quarter Ended
		September 30, 2021				June 30, 2022				September 30, 2022
		RMB				RMB				RMB				US$
		(in millions, except per share and per ADS data)
Net income (loss) attributable to H World Group Limited (GAAP)			(137	)			(350	)			(717	)			(101	)
Interest income			(25	)			(19	)			(23	)			(3	)
Interest expense			101				90				93				13
Income tax expense (benefit)			(13	)			(299	)			434				61
Depreciation and amortization			368				365				362				51
EBITDA (non-GAAP)			294				(213	)			149				21
Share-based compensation expense			31				26				29				4
Unrealized (gains) losses from fair value changes of equity securities			60				240				313				44
Adjusted EBITDA (non-GAAP)			385				53				491				69

 

 

 

H World Group Limited

 

Segment Financial Summary⁽¹⁾

 

		Quarter Ended September 30, 2021												Quarter Ended June 30, 2022												Quarter Ended September 30, 2022
		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			1,784				561				2,345				1,475				886				2,361				1,793				902				2,695				379
Manachised and franchised hotels			1,110				18				1,128				929				16				945				1,291				22				1,313				185
Others			40				10				50				57				19				76				77				8				85				11
Revenue			2,934				589				3,523				2,461				921				3,382				3,161				932				4,093				575
Hotel operating costs			(2,255	)			(630	)			(2,885	)			(2,168	)			(804	)			(2,972	)			(2,301	)			(744	)			(3,045	)			(428	)
Selling and marketing expenses			(129	)			(60	)			(189	)			(65	)			(77	)			(142	)			(105	)			(76	)			(181	)			(26	)
General and administrative expenses			(306	)			(82	)			(388	)			(267	)			(101	)			(368	)			(330	)			(75	)			(405	)			(57	)
Pre-opening expenses			(15	)			-				(15	)			(31	)			-				(31	)			(25	)			-				(25	)			(3	)
Income (losses) from operations			239				(167	)			72				21				(13	)			8				449				51				500				70
Net income (loss) attributable to H World Group Limited			27				(164	)			(137	)			(298	)			(52	)			(350	)			(731	)			14				(717	)			(101	)
Interest income			(25	)			(0	)			(25	)			(19	)			(0	)			(19	)			(23	)			(0	)			(23	)			(3	)
Interest expense			72				29				101				57				33				90				60				33				93				13
Income tax expense			29				(42	)			(13	)			(287	)			(12	)			(299	)			446				(12	)			434				61
Depreciation and amortization			306				62				368				304				61				365				303				59				362				51
EBITDA (non-GAAP)			409				(115	)			294				(243	)			30				(213	)			55				94				149				21
Share-based Compensation			31				-				31				26				-				26				29				-				29				4
Unrealized (gains) losses from fair value changes of equity securities			60				-				60				240				-				240				313				-				313				44
Adjusted EBITDA (non-GAAP)			500				(115	)			385				23				30				53				397				94				491				69

 

(1) The Company presents segment information after elimination of intercompany transactions.

 

 

 

Operating Results: Legacy-Huazhu⁽¹⁾

 

		Number of hotels																Number of rooms
		Opened in Q3 2022				Closed (2) in Q3 2022				Net added in Q3 2022				As of September 30, 2022 (3)				As of September 30, 2022
Leased and owned hotels			4				(19	)			(15	)			631				90,034
Manachised and franchised hotels			425				(185	)			240				7,645				682,193
Total			429				(204	)			225				8,276				772,227

 

(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 Q3 2022, we temporarily closed 14 hotels for brand upgrade and business model change purposes.

(3)         As of September 30, 2022, 558 hotels were requisitioned by governmental authorities.

 

		As of September 30, 2022
		Number of hotels				Unopened hotels in pipeline
Economy hotels			4,898				950
Leased and owned hotels			363				1
Manachised and franchised hotels			4,535				949
Midscale and upscale hotels			3,378				1,324
Leased and owned hotels			268				16
Manachised and franchised hotels			3,110				1,308
Total			8,276				2,274

 

 

 

Operational hotels excluding hotels under requisition⁽⁴⁾

 

		For the quarter ended
		September 30,				June 30,				September 30,				yoy
		2021				2022				2022				change
Average daily room rate (in RMB)
Leased and owned hotels			296				243				294				-0.6	%
Manachised and franchised hotels			238				215				248				4.3	%
Blended			246				218				254				3.1	%
Occupancy Rate (as a percentage)
Leased and owned hotels			69.7	%			62.9	%			73.1	%			+3.4 p.p.
Manachised and franchised hotels			72.2	%			64.9	%			76.4	%			+4.2 p.p.
Blended			71.9	%			64.6	%			76.0	%			+4.2 p.p.
RevPAR (in RMB)
Leased and owned hotels			206				153				215				4.2	%
Manachised and franchised hotels			172				139				190				10.4	%
Blended			177				141				193				9.1	%

 

		For the quarter ended
		September 30,				September 30,				yoy
		2019				2022				change
Average daily room rate (in RMB)
Leased and owned hotels			288				294				2.1	%
Manachised and franchised hotels			235				248				5.5	%
Blended			245				254				3.4	%
Occupancy Rate (as a percentage)
Leased and owned hotels			90.0	%			73.1	%			-16.9 p.p.
Manachised and franchised hotels			87.2	%			76.4	%			-10.8 p.p.
Blended			87.7	%			76.0	%			-11.7 p.p.
RevPAR (in RMB)
Leased and owned hotels			259				215				-17.1	%
Manachised and franchised hotels			205				190				-7.5	%
Blended			215				193				-10.3	%

 

(4)         If including hotels under requisition, RevPAR in Q3 2022 would have been 90% of the 2019 level.

 

 

 

 

 

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
						For the quarter							For the quarter							For the quarter
		As of September 30,				ended September 30,				yoy change			ended September 30,				yoy change			ended September 30,						yoy change
		2021		2022		2021		2022					2021		2022					2021			2022			(p.p.)
Economy hotels		3,366		3,366		146		148		1.4	%		189		188		-0.7	%		77.0	%		78.6	%		+1.6
Leased and owned hotels		363		363		158		164		3.7	%		215		211		-1.8	%		73.5	%		77.6	%		+4.1
Manachised and franchised hotels		3,003		3,003		143		145		1.0	%		185		184		-0.5	%		77.6	%		78.7	%		+1.1
Midscale and upscale hotels		2,122		2,122		228		242		6.2	%		324		322		-0.5	%		70.3	%		75.0	%		+4.7
Leased and owned hotels		233		233		261		273		4.6	%		398		389		-2.4	%		65.5	%		70.3	%		+4.7
Manachised and franchised hotels		1,889		1,889		221		236		6.6	%		311		311		0.0	%		71.2	%		75.8	%		+4.7
Total		5,488		5,488		183		190		3.9	%		248		248		-0.2	%		73.9	%		76.9	%		+3.0

 

		Number of hotels				Same-hotel RevPAR							Same-hotel ADR							Same-hotel Occupancy
						For the quarter							For the quarter							For the quarter
		As of September 30,				ended September 30,				yoy change			ended September 30,				yoy change			ended September 30,						yoy change
		2019		2022		2019		2022					2019		2022					2019			2022			(p.p.)
Economy hotels		2,057		2,057		189		147		-22.5	%		203		187		-7.5	%		93.5	%		78.4	%		-15.2
Leased and owned hotels		346		346		211		161		-23.5	%		226		208		-7.9	%		93.4	%		77.5	%		-15.9
Manachised and franchised hotels		1,711		1,711		184		143		-22.1	%		196		182		-7.3	%		93.5	%		78.6	%		-14.9
Midscale and upscale hotels		994		994		295		234		-20.7	%		341		319		-6.3	%		86.7	%		73.4	%		-13.2
Leased and owned hotels		181		181		354		251		-29.2	%		405		362		-10.5	%		87.5	%		69.2	%		-18.2
Manachised and franchised hotels		813		813		277		229		-17.3	%		321		307		-4.3	%		86.4	%		74.7	%		-11.7
Total		3,051		3,051		230		180		-21.6	%		254		236		-6.9	%		90.9	%		76.5	%		-14.4

 

 

 

 

Operating Results: Legacy-DH⁽⁵⁾

 

		Number of hotels																Number of rooms				Unopened hotels in pipeline
		Opened   in Q3 2022				Closed in Q3 2022				Net added in Q3 2022				As of   September 30, 2022(6)				As of   September 30, 2022				As of September 30, 2022
Leased hotels			-				-				-				79				14,939				27
Manachised and franchised hotels			1				-				1				47				10,323				12
Total			1				-				1				126				25,262				39

 

(5)

Legacy-DH refers to DH.

 

(6)

As of September 30, 2022, a total of 4 hotels were temporarily closed. 1 hotel was closed for renovation and 1 hotel was closed due to flood damage. Additionally, 1 hotel was temporarily closed due to extensive hotel refurbishment, and 1 hotel was temporarily closed due to seasonal break .

 

		For the quarter ended
		September 30,				June 30,				September 30,				yoy
		2021				2022				2022				change
Average daily room rate  (in EUR)
Leased hotels			94.3				112.6				112.9				19.7	%
Manachised and franchised hotels			104.5				106.7				115.6				10.6	%
Blended			98.6				110.4				113.9				15.5	%
Occupancy rate (as a percentage)
Leased hotels			48.0	%			61.2	%			67.4	%			+19.5 p.p.
Managed and franchised hotels			49.4	%			57.9	%			64.1	%			+14.7 p.p.
Blended			48.6	%			59.8	%			66.1	%			+17.5 p.p.
RevPAR  (in EUR)
Leased hotels			45.3				68.9				76.1				68.2	%
Managed and franchised hotels			51.6				61.8				74.1				43.5	%
Blended			47.9				66.0				75.3				57.2	%

 

 

 

 

Hotel Portfolio by Brand

 

		As of September 30, 2022
		Hotels				Rooms				Unopened hotels
			in operation								in pipeline
Economy hotels			4,913				386,911				964
HanTing Hotel			3,207				285,313				603
Hi Inn			460				24,128				127
Ni Hao Hotel			140				10,074				192
Elan Hotel			868				42,810				-
Ibis Hotel			223				22,876				28
Zleep Hotels			15				1,710				14
Midscale hotels			2,816				308,164				1,001
Ibis Styles Hotel			85				8,864				18
Starway Hotel			565				46,492				212
JI Hotel			1,629				192,872				534
Orange Hotel			505				54,822				229
CitiGO Hotel			32				5,114				8
Upper midscale hotels			525				75,500				263
Crystal Orange Hotel			161				21,314				53
Manxin Hotel			111				10,443				52
Madison Hotel			50				7,276				62
Mercure Hotel			133				22,250				54
Novotel Hotel			17				4,424				18
IntercityHotel(7)			53				9,793				24
Upscale hotels			124				21,223				76
Jaz in the City			3				587				1
Joya Hotel			8				1,368				1
Blossom House			43				2,055				52
Grand Mercure Hotel			8				1,897				5
Steigenberger Hotels & Resorts(8)			53				13,754				10
MAXX (9)			9				1,562				7
Luxury hotels			15				2,326				4
Steigenberger Icon(10)			9				1,847				1
Song Hotels			6				479				3
Others			9				3,365				5
Other hotels(11)			9				3,365				5
Total			8,402				797,489				2,313

 

(7)

As of September 30, 2022, 3 operational hotels and 10 pipeline hotels of IntercityHotel were in China.

 

(8)

As of September 30, 2022, 11 operational hotels and 3 pipeline hotels of Steigenberger Hotels & Resorts were in China.

 

(9)

As of September 30, 2022, 3 operational hotels and 7 pipeline hotels of MAXX were in China.

 

(10)

As of September 30, 2022, 3 operational hotels of Steigenberger Icon were in China.

 

(11)

Other hotels include other partner hotels and other hotel brands in Yongle Huazhu Hotel & Resort Group (excluding Steigenberger Hotels & Resorts and Blossom House).