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Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Huazhu Group Limited Announces Preliminary Results for Hotel Operations in the Second Quarter ...

July 22, 2021 GMT

SHANGHAI, China, July 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 second quarter (“Q2 2021”) ended June 30, 2021.

COVID-19 update
For our Legacy-Huazhu business, the RevPAR in 2Q2021 recovered to 102% of 2019, slightly below our previous expectation. RevPAR recovery in June achieved 100%, slowing down from 106% in May. It was mainly due to COVID-19 resurgence in Guangdong Province and traffic control in Beijing for the celebration of centenary of the Communist Party of China since late May. However, if excluding the impact of Guangdong Province and Beijing, our RevPAR recovery was on track. In July, with the COVID-19 resurgence in Guangdong effectively contained and relaxation of travel restriction in Beijing, our RevPAR recovery resumed.

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Steigenberger Hotels AG and its subsidiaries (“DH”) saw an initial recovery of hotel demand along with vaccination process in Germany since the first lockdown in November 2020. As of July 16th, 2021, almost 60% of Germans have received at least one shot of vaccine. In July, the recovery continued with occupancy rate reaching 35%. But the recovery is still uncertain given that the recent news shows there is possibly another upcoming wave of delta variant of COVID-19 resurgence in European countries.

Operating Results: Legacy-Huazhu (1)

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  Number of hotels   Number of rooms
  Opened
in Q2 2021
Closed (2)
in Q2 2021
Net added
in Q2 2021
As of
June 30, 2021 (3)
  As of
June 30, 2021
   
Leased and owned hotels 18 (7 ) 11 675   91,892
Manachised and franchised hotels 381 (149 ) 232 6,329   575,778
Total 399 (156 ) 243 7,004   667,670
               
(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 Q2 2021, we temporarily closed 8 hotels for brand upgrade and business model change purposes.
(3)    As of June 30, 2021, 32 hotels were requisitioned by governmental authorities.
  As of June 30, 2021
  Number of hotels Unopened hotels in pipeline
Economy hotels 4,451 1,295
Leased and owned hotels 417 3
Manachised and franchised hotels 4,034 1,292
Midscale and upscale hotels 2,553 1,401
Leased and owned hotels 258 13
Manachised and franchised hotels 2,295 1,388
Total 7,004 2,696
Operational hotels excluding hotels under requisition
  For the quarter ended  
  June 30, March 31, June 30, yoy
  2020 2021 2021 change
Average daily room rate (in RMB)      
Leased and owned hotels 205 243 311 51.8%
Manachised and franchised hotels 181 203 246 36.2%
Blended 185 209 255 38.3%
Occupancy rate (as a percentage)      
Leased and owned hotels 67.4% 64.0% 81.1% 13.7 p.p.
Manachised and franchised hotels 69.1% 66.6% 82.5% 13.4 p.p.
Blended 68.8% 66.2% 82.3% 13.5 p.p.
RevPAR (in RMB)        
Leased and owned hotels 138 156 252 82.7%
Manachised and franchised hotels 125 135 203 62.7%
Blended 127 138 210 65.5%
  For the quarter ended
  June 30, June 30, yoy
  2019 2021 change
Average daily room rate (in RMB)    
Leased and owned hotels 281 311 10.4%
Manachised and franchised hotels 225 246 9.2%
Blended 236 255 7.9%
Occupancy rate (as a percentage)    
Leased and owned hotels 89.4% 81.1% -8.4p.p.
Manachised and franchised hotels 86.3% 82.5% -3.8p.p.
Blended 86.9% 82.3% -4.6p.p.
RevPAR (in RMB)      
Leased and owned hotels 252 252 0.1%
Manachised and franchised hotels 194 203 4.4%
Blended 206 210 2.2%
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
June 30,

For the quarter yoy For the quarter yoy For the quarter yoy
  ended
June 30,
change ended
June 30,
change ended
June 30,
change
  2020 2021 2020 2021   2020 2021   2020   2021   (p.p.)
Economy hotels 3,017 3,017 107 168 57.7 % 146 196 34.4 % 73.1 % 85.8 % 12.7
Leased and owned hotels 408 408 109 191 75.7 % 154 227 47.6 % 70.8 % 84.2 % 13.5
Manachised and franchised hotels 2,609 2,609 106 163 53.6 % 144 189 31.3 % 73.7 % 86.2 % 12.5
Midscale and upscale hotels 1,520 1,520 172 272 57.8 % 254 336 32.3 % 68.0 % 81.0 % 13.1
Leased and owned hotels 213 213 182 316 73.3 % 285 405 42.3 % 64.0 % 77.9 % 13.9
Manachised and franchised hotels 1,307 1,307 170 262 54.1 % 247 321 29.9 % 68.9 % 81.7 % 12.8
Total 4,537 4,537 133 210 58.1 % 187 250 33.9 % 71.1 % 83.9 % 12.8
 
  Number of hotels Same-hotel RevPAR Same-hotel ADR Same-hotel Occupancy
  As of
June 30,

For the quarter yoy For the quarter yoy For the quarter yoy
  ended
June 30,
change ended
June 30,
change ended
June 30,
change
  2019 2021 2019 2021   2019 2021   2019   2021   (p.p.)
Economy hotels 2,308 2,308 179 168 -5.9 % 193 195 1.2 % 92.5 % 86.0 % -6.5
Leased and owned hotels 392 392 202 187 -7.2 % 217 223 2.9 % 93.3 % 84.1 % -9.2
Manachised and franchised hotels 1,916 1,916 172 163 -5.6 % 187 188 0.8 % 92.3 % 86.5 % -5.8
Midscale and upscale hotels 931 931 285 269 -5.7 % 337 338 0.1 % 84.6 % 79.7 % -4.9
Leased and owned hotels 184 184 350 311 -11.1 % 406 401 -1.4 % 86.1 % 77.7 % -8.5
Manachised and franchised hotels 747 747 264 255 -3.3 % 314 317 1.1 % 84.1 % 80.4 % -3.7
Total 3,239 3,239 216 203 -5.7 % 240 243 1.0 % 89.7 % 83.8 % -6.0

Operating Results: Legacy-DH (4)

  Number of hotels   Number of
rooms
  Unopened hotels
in pipeline
  Opened
in Q2 2021
Closed
in Q2 2021
Net added
in Q2 2021
As of
June 30,
2021(5)
 

 

As of
June 30, 2021
 

 

As of
June 30, 2021
 
Leased hotels 1 - 1 74   13,839   27
Manachised and franchised hotels 1 - 1 48   10,775   11
Total 2 - 2 122   24,614   38
                 
(4)    Legacy-DH refers to DH.
(5)    As of June 30, 2021, a total of 5 DH brand hotels were temporarily closed due to COVID-19, and 1 hotel was closed for renovation.
  For the quarter ended  
  June 30, March 31, June 30, yoy
  2020   2021   2021   change
Average daily room rate (in EUR)        
Leased hotels 82.4   77.9   85.2   3.4 %
Manachised and franchised hotels 96.5   59.0   77.9   -19.3 %
Blended 86.5   68.5   81.5   -5.8 %
Occupancy rate (as a percentage)        
Leased hotels 18.7 % 14.6 % 20.0 % 1.3 %
Managed and franchised hotels 17.3 % 26.5 % 30.8 % 13.5 %
Blended 18.3 % 18.8 % 24.4 % 6.1 %
RevPAR (in EUR)        
Leased hotels 15.4   11.4   17.04   10.7 %
Managed and franchised hotels 16.7   15.6   24.01   43.5 %
Blended 15.8   12.9   19.85   25.6 %

Hotel Portfolio by Brand

  Total
  Hotels Rooms Unopened hotels
  in operation in pipeline
Economy hotels 4,465 370,297 1,307
HanTing Hotel 2,834 260,252 740
Hi Inn 430 25,419 83
Elan Hotel(6) 976 60,645 431
Ibis Hotel 211 22,320 41
Zleep Hotels 14 1,661 12
Midscale hotels 2,146 241,370 1,121
Ibis Styles Hotel 78 9,046 19
Starway Hotel 477 39,524 279
JI Hotel 1,203 148,008 616
Orange Hotel 360 40,285 202
CitiGO Hotel(7) 28 4,507 5
Upper midscale hotels 408 61,350 250
Crystal Orange Hotel 129 17,517 60
Manxin Hotel 68 6,764 54
Madison Hotel 31 4,745 40
Mercure Hotel 117 19,786 57
Novotel Hotel 13 3,579 17
IntercityHotel(8) 48 8,535 20
Upscale hotels 101 17,681 54
Joya Hotel 9 1,760 0
Blossom House 29 1,420 30
Grand Mercure Hotel 7 1,485 6
Steigenberger Hotels & Resorts(9) 51 12,239 12
MAXX (10) 5 777 6
Jaz in the City 2 424 2
Others 6 1,586 2
Other hotels(11) 6 1,586 2
Total 7,126 692,284 2,734

(6)    As of June 30, 2021, 17 Ni Hao Hotels were included in the operational hotel for Elan Hotels and 111 Ni Hao hotels were included in the pipeline for Elan Hotels.
(7)    We completed CitiGO acquisition in May 2021.
(8)    As of June 30, 2021, 2 operational hotels and 4 pipeline hotels of IntercityHotel were in China.
(9)    As of June 30, 2021, 1 operational hotel and 5 pipeline hotels of Steigenberger Hotels & Resorts were in China.
(10)  As of June 30, 2021, 5 pipeline hotels of MAXX 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).

About Huazhu Group Limited
Originated in China, Huazhu Group Limited is a world-leading hotel group. As of June 30, 2021, Huazhu operated 7,126 hotels with 692,284 rooms in operation in 17 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, Ni Hao Hotel and CitiGO 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 Hotels. 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 June 30, 2021, Huazhu operates 15 percent of its hotel rooms under lease and ownership model, and 85 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