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