Investment Rating - Maintain "Recommend" rating [1][2] Core Views - The company achieved a significant turnaround in 2023, with revenue reaching 21.9 billion yuan, a 57.9% YoY increase, and net profit attributable to the parent company of 4.085 billion yuan, compared to a loss of 1.8 billion yuan in 2022 [1] - RevPAR exceeded 2019 levels, driven by ADR growth, with Huazhu-branded hotels achieving a 229 yuan RevPAR in Q4 2023, up 43.8% YoY and 20.0% compared to 2019 [1] - Steady expansion with 460 new openings in Q4 2023, bringing the total number of operating hotels to 9,394 globally, with a strong pipeline of 3,061 hotels [1] - The company is leveraging its competitive advantages in product structure, brand effectiveness, and membership systems, with operational cost reductions and efficiency improvements driving high performance elasticity [1] - Expected net profit attributable to the parent company for 2024-2026 is 4.389 billion, 4.955 billion, and 5.399 billion yuan, respectively, with corresponding P/E ratios of 24x, 21x, and 19x [1][2] Financial Performance - 2023 revenue: 21.882 billion yuan, +57.9% YoY [2] - 2023 net profit attributable to parent: 4.085 billion yuan, +324.3% YoY [2] - 2023 EPS: 1.25 yuan, with a P/E ratio of 25x [2] - 2024E revenue: 23.396 billion yuan, +6.9% YoY [2] - 2024E net profit attributable to parent: 4.389 billion yuan, +7.5% YoY [2] - 2024E EPS: 1.34 yuan, with a P/E ratio of 24x [2] Operational Metrics - Huazhu-branded hotels: Q4 2023 RevPAR of 229 yuan, +43.8% YoY, +20.0% vs 2019; ADR of 284 yuan, +18.3% YoY, +22.5% vs 2019; OCC of 80.5%, +14.3pct YoY, -1.7pct vs 2019 [1] - Deutsche Hospitality: Q4 2023 RevPAR of 73 euros, +1.3% YoY, +10.6% vs 2019; ADR of 115 euros, -5.9% YoY, +18.6% vs 2019; OCC of 63.8%, +4.5pct YoY, -4.2pct vs 2019 [1] - Total operating hotels: 9,394 globally, with 9,263 Huazhu-branded hotels and 131 Deutsche Hospitality hotels [1] - Pipeline: 3,061 hotels, including 1,121 economy, 1,503 mid-scale, 397 upper mid-scale, and 69 upscale hotels [1] Strategic Focus - Continued focus on mid-to-high-end brand expansion, with Han Ting and Quan Ji hotels growing by 10.5% and 24.9% YoY, respectively [1] - Emphasis on high-quality lean growth, with ongoing optimization of hotel quality and development [1] - Integration of membership and supply chain platforms to further enhance operational efficiency and performance [1]

海 外 研 证券研究报告 究 ＃industryId＃ 酒店出行 ＃investSuggestion＃ ＃ ＃01179 .HK ＃华dy住Com集pa团ny＃- S dyStockco investS d e＃ 买入 ( u 维gg 持esti ） R evPA R 恢复优于＃ 行tit 业le＃ ， 2023 年境外扭亏 onChan ge＃ ＃createTime1＃ 2024年 3月 27 日 投资要点 公 ＃市场ma数rk据et Data＃ ＃ ⚫ sum 维ma 持ry “＃买 入”评级：公司的RevPAR保持优于行业的复苏速度，境外主动整合，盈利能力持 司 日期 2024.3.27 续恢复，境内坚持下沉和中高档市场战略，并积极清理老旧产品线，原相对薄弱区域如华 跟 收盘价（港元） 29.75 南能力也在逐步提升，同时公司数字化能力领先，中央预订系统培育了较好的客户粘性。 踪 总股本（亿股） 32.65 我们小幅上调盈利预测，预计公司2024E/2025E/2026E营业收入为241/259/279亿元人民 报 总市值（亿港元） 971.47 币，同比增长 10.0%/7.8%/7.6%；归母净利 ...

Investment Rating - The investment rating for the company is "Buy" (maintained) [4] Core Views - The company's performance in Q4 2023 met expectations, with a significant revenue increase of 50.7% year-on-year, reaching 5.585 billion yuan. Domestic revenue grew by 59.0%, driven by both direct and managed hotel segments [1][7] - The company continues to enhance its operational quality, as evidenced by a return to profitability with a net profit of 743 million yuan in Q4 2023, compared to a loss of 124 million yuan in the same period last year [1][7] - The company has exceeded its annual store opening targets, with a net increase of 852 stores in 2023, showcasing its strong expansion capabilities [3][7] Summary by Sections Financial Performance - In Q4 2023, the company achieved a revenue of 5.585 billion yuan, with domestic revenue contributing 4.384 billion yuan. The direct hotel segment accounted for 52.2% of total revenue, while managed and franchised hotels contributed 47.8% [1] - The company's Q4 2023 RevPAR (Revenue per Available Room) for domestic hotels was 229 yuan, reflecting a year-on-year increase of 43.8% compared to Q4 2022 and 19.9% compared to Q4 2019 [2] - The company provided revenue guidance for Q1 2024, expecting a year-on-year growth of 12%-16% [7] Expansion and Pipeline - The company opened 460 new hotels in Q4 2023, with a net increase of 235 hotels, surpassing its initial target of 1,400 openings for the year [3] - The pipeline for future openings stands at 3,061 hotels, indicating continued expansion plans and a strong market position [3] Financial Projections - The company forecasts net profits of 4.349 billion yuan for 2024, with a projected P/E ratio of 20.6x [8] - Expected revenue growth rates for the next few years are 4.8% in 2024, 7.8% in 2025, and 7.8% in 2026 [8]

证券研究报告 | 2024年03月22日 华住集团-S（01179.HK） 买入 国内净利润较 2019 年增长 149%，2024 年开店目标提速 核心观点 公司研究·财报点评 2023年国内净利润较2019年增长149%，海外EBITDA转正。2023年公司收 社会服务·酒店餐饮 入219亿元/+58%，其中国内收入174亿元/+64%(较19年增长56%)，海外 证券分析师：曾光 证券分析师：钟潇 DH收入44亿元/+37%。Q4公司收入57亿元/+51%,超指引(41-45%)，其中国 0755-82150809 0755-82132098 zengguang@guosen.com.cn zhongxiao@guosen.com.cn 内收入44亿元/+59%，系增长主力。2023年公司归母净利润为41亿元，同 S0980511040003 S0980513100003 比扭亏;其中国内归母净利润44亿，较2019年增长149%；国内经调整EBITDA 证券分析师：张鲁 联系人：杨玉莹 率达39%，较2019年增长9pct，预计系收益管理、经营效率等综合带动。 010-88005377 0755-81 ...

股 票 研 究 [Table_industryInfo] 社会服务业 [ Table_Main[华I Tnaf 住bol]e 集_Ti团tle] - S（1179） [评Tab级le_：Inv est] 增持 当前价格（港元）： 31.25 优势明显份额提升，估值有望持续修复 2024.03.21 海 ——华住集团23Q4 业绩点评 [ 交Ta易bl数e_M据a rket] 外 刘越男(分析师) 于清泰(分析师) 52周内股价区间（港元） 23.45-39.50 当前股本（百万股） 3,265 公 021-38677706 021-38022689 当前市值（百万港元） 102,045 司 liuyuenan@gtjas.com yuqingtai@gtjas.com 证书编号 S0880516030003 S0880519100001 （ [ Table_PicQuote] 中 本报告导读： 52周内股价走势图 国 2023Q4 业绩及对 2024 年指引均符合预期，华住自身竞争优势明显，将持续获取份 华住集团-S 恒生指数 额，估值修复进程将持续。 香 9% 摘要： 港 1% [T abl业e_S绩um ...

证券研究报告·海外公司点评·旅游及消闲设施(HS) 华住集团-S（01179.HK） 2023 年报点评：Q4 营收超指引，净开店将提 2024年 03月 21日 速 证券分析师 吴劲草 买入（维持） 执业证书：S0600520090006 wujc@dwzq.com.cn [Table_EPS] 盈利预测与估值 2022A 2023A 2024E 2025E 2026E 证券分析师 石旖瑄 营业总收入（百万元） 13,862 21,882 24,189 26,014 27,484 执业证书：S0600522040001 同比 8.42% 57.86% 10.54% 7.55% 5.65% shiyx@dwzq.com.cn 归母净利润（百万元） -1,821 4,085 4,219 4,554 4,902 股价走势 同比 -291.61% 324.33% 3.29% 7.94% 7.64% EPS-最新摊薄（元/股） -0.56 1.25 1.29 1.39 1.50 华住集团-S 恒生指数 P/E（现价&最新摊薄） - 22.66 21.94 20.33 18.89 4% -40% % [ [TT aab ...

[Table_Title] 证券研究报告 华住集团-S 23 年业绩点评：全年业绩创新 公司研究 高，24 年仍有成长弹性 [Table_ReportType] 公司点评报告 [Table_ReportDate] 2024年3月21日 [华Ta住bl集e_团Sto-cSk(A1n1dR7a9n)k ] [T业ab绩le表_S现um：ma 2r 3y年] 41亿业绩创新高，23Q4体现公司穿越周期能力。公司23 投资评级 年全年实现收入219亿元（同比+58%），对应归母净利润41亿元（22年同 上次评级 期亏损18亿元）。分季度看， 23Q4实现收入56亿元（同比+51%）（Q1~Q3 分别为 45、55、63 亿元），其中境内分部实现收入 44 亿元（同比+59%）； [刘Ta嘉b仁le _社Au零th&o美r]护 首席分析师 23Q4 对应归母净利润 7.4 亿元（22 年同期亏损 1.2 亿元）（Q1~Q3 分别为 执业编号：S1500522110002 10、10、13亿元），其中境内分部净利润8.3亿元（22年同期亏损0.8亿元）。 联系电话：15000310173 考虑23Q4行业需求转弱，公司依 ...

Hotel Operations and Performance - H World Group operated a total of 9,394 hotels (or 912,444 rooms) as of December 31, 2023[2] - Legacy-Huazhu's Q4 2023 ADR was RMB 284, up from RMB 240 in Q4 2022, with an occupancy rate of 80.5%[6] - Legacy-Huazhu's Q4 2023 RevPAR was RMB 229, up from RMB 159 in Q4 2022, with a same-store RevPAR growth of 40.8% YoY[6] - Legacy-DH operated 131 hotels (26,814 rooms) as of December 31, 2023, with 37 hotels in the pipeline[6] - Average daily rate (ADR) in Q4 2023 was €115, compared to €122 in Q4 2022 and €114 in the previous quarter[7] - Occupancy rate for Legacy-DH hotels in Q4 2023 was 63.8%, up from 59.3% in Q4 2022 but down from 69.0% in the previous quarter[7] - Revenue per available room (RevPAR) in Q4 2023 was €73, compared to €72 in Q4 2022 and €79 in the previous quarter[7] - The company operates 9,394 hotels with 912,444 rooms in operation across 18 countries as of December 31, 2023[24] - 11% of the company's hotel rooms are operated under the lease and owned model, while 89% are under the managed franchise and franchise model[24] - Total number of operating hotels reached 9,394 with 912,444 rooms as of December 31, 2023[46] - Economy hotels accounted for 4,984 operating hotels with 407,657 rooms and 1,121 hotels in the pipeline[46] - Midscale hotels represented 3,543 operating hotels with 379,614 rooms and 1,503 hotels in the pipeline[46] - Upscale hotels had 704 operating hotels with 98,508 rooms and 397 hotels in the pipeline[46] - Luxury hotels included 16 operating hotels with 2,360 rooms and 2 hotels in the pipeline[46] - Intercity Hotel had 9 operating hotels and 53 hotels in the pipeline in China as of December 31, 2023[47] - Steigenberger had 11 operating hotels and 3 hotels in the pipeline in China as of December 31, 2023[47] Financial Performance - Q4 2023 hotel turnover increased by 55.0% YoY to RMB 20.4 billion, and excluding DH, it increased by 60.6% YoY[2] - Q4 2023 revenue grew by 50.7% YoY to RMB 5.6 billion (USD 786 million), exceeding the guidance of 41% to 45% growth[2] - Q4 2023 net profit attributable to H World Group was RMB 743 million (USD 105 million), compared to a net loss of RMB 124 million in Q4 2022[2] - Q4 2023 EBITDA (non-GAAP) was RMB 1.4 billion (USD 191 million), compared to RMB 529 million in Q4 2022[3] - Total revenue in Q4 2023 was RMB 5.585 billion (USD 786 million), a 50.7% YoY increase but an 11.2% QoQ decrease[9] - Legacy-Huazhu revenue in Q4 2023 was RMB 4.4 billion, a 59.0% YoY increase, exceeding the previously announced guidance of 48% to 52% growth[9] - Legacy-DH revenue in Q4 2023 was RMB 1.2 billion, a 26.6% YoY increase and a 2.2% QoQ increase[9] - Full-year 2023 revenue was RMB 21.9 billion (USD 3.1 billion), a 57.9% YoY increase[10] - Legacy-Huazhu full-year 2023 revenue was RMB 17.4 billion, a 63.7% YoY increase[10] - Legacy-DH full-year 2023 revenue was RMB 4.4 billion, a 38.6% YoY increase[10] - Management and franchised hotel revenue in Q4 2023 was RMB 2.0 billion (USD 284 million), a 74.1% YoY increase but an 11.1% QoQ decrease[11] - Hotel operating costs for Q4 2023 were RMB 4 billion (USD 563 million), a 17.6% YoY increase from RMB 3.4 billion in Q4 2022, primarily due to business recovery and smaller rent reductions[13] - Legacy-Huazhu division's hotel operating costs in Q4 2023 were RMB 2.9 billion, accounting for 67.0% of revenue, compared to 88.7% in Q4 2022[13] - Full-year 2023 hotel operating costs were RMB 14.3 billion (USD 2 billion), a 16.3% increase from RMB 12.3 billion in 2022[13] - Sales and marketing expenses for Q4 2023 were RMB 326 million (USD 46 million), a 92.9% YoY increase from RMB 169 million in Q4 2022[13] - General and administrative expenses for Q4 2023 were RMB 644 million (USD 91 million), a 46.4% YoY increase from RMB 440 million in Q4 2022[13] - Operating profit for Q4 2023 was RMB 757 million (USD 106 million), compared to an operating loss of RMB 93 million in Q4 2022[15] - Legacy-Huazhu division's operating profit for Q4 2023 was RMB 821 million, compared to an operating loss of RMB 3 million in Q4 2022[15] - Full-year 2023 operating profit was RMB 4.7 billion (USD 662 million), compared to an operating loss of RMB 294 million in 2022[15] - Operating profit margin for Q4 2023 was 13.6%, compared to -2.5% in Q4 2022[15] - Full-year 2023 operating profit margin was 21.5%, compared to -2.1% in 2022[15] - Equity securities fair value change income for 2023 was RMB 109 million (USD 15 million), compared to a loss of RMB 359 million in 2022, primarily due to gains from UBOX fair value changes and losses from Accor shares in 2022[17] - Net income attributable to Huazhu Group Limited for Q4 2023 was RMB 743 million (USD 105 million), compared to a net loss of RMB 124 million in Q4 2022 and net income of RMB 1.3 billion in the previous quarter[17] - Full-year 2023 net income attributable to Huazhu Group Limited was RMB 4.1 billion (USD 575 million), compared to a net loss of RMB 1.8 billion in 2022[17] - Q4 2023 EBITDA (non-GAAP) was RMB 1.4 billion (USD 191 million), compared to RMB 529 million in Q4 2022 and RMB 2.1 billion in the previous quarter[17] - Full-year 2023 EBITDA (non-GAAP) was RMB 6.8 billion (USD 961 million), compared to RMB 164 million in 2022[18] - Operating cash inflow for Q4 2023 was RMB 2.4 billion (USD 339 million), with full-year operating cash inflow reaching RMB 7.7 billion (USD 1.1 billion), compared to RMB 1.6 billion in 2022[19] - As of December 31, 2023, the company's cash and cash equivalents totaled RMB 6.9 billion (USD 978 million), with restricted cash at RMB 764 million (USD 108 million)[19] - Total revenue for 2023 reached RMB 21.882 billion (USD 3.082 billion), a significant increase from RMB 13.862 billion in 2022[29] - Net profit attributable to Huazhu Group Limited for 2023 was RMB 4.085 billion (USD 575 million), compared to a net loss of RMB 1.821 billion in 2022[30] - Total liabilities decreased from RMB 52.704 billion in 2022 to RMB 51.283 billion (USD 7.223 billion) in 2023[28] - Total equity increased from RMB 8.803 billion in 2022 to RMB 12.249 billion (USD 1.725 billion) in 2023[28] - Operating profit for 2023 was RMB 4.714 billion (USD 662 million), a significant improvement from an operating loss of RMB 294 million in 2022[29] - Revenue from leased and owned hotels increased to RMB 13.796 billion (USD 1.943 billion) in 2023, up from RMB 9.148 billion in 2022[29] - Revenue from managed and franchised hotels grew to RMB 7.694 billion (USD 1.084 billion) in 2023, compared to RMB 4.405 billion in 2022[29] - Total operating costs and expenses for 2023 were RMB 17.568 billion (USD 2.476 billion), up from RMB 14.705 billion in 2022[29] - Basic earnings per share for 2023 were RMB 1.28 (USD 0.18), a significant improvement from a loss of RMB 0.59 per share in 2022[30] - Total assets increased from RMB 61.507 billion in 2022 to RMB 63.532 billion (USD 8.948 billion) in 2023[28] - Net profit (loss) for the year 2023 was RMB 4,131 million (USD 582 million), a significant improvement from the net loss of RMB 1,849 million in 2022[31] - Operating cash flow for 2023 was RMB 7,674 million (USD 1,080 million), compared to RMB 1,564 million in 2022[31] - Capital expenditures for 2023 were RMB 901 million (USD 127 million), a decrease from RMB 1,053 million in 2022[31] - Net cash used in investing activities for 2023 was RMB 1,477 million (USD 207 million), compared to RMB 522 million in 2022[31] - Net cash used in financing activities for 2023 was RMB 3,720 million (USD 523 million), compared to RMB 1,394 million in 2022[32] - Adjusted net profit (non-GAAP) for 2023 was RMB 4,119 million (USD 580 million), compared to a net loss of RMB 1,375 million in 2022[33] - Basic adjusted earnings per share (non-GAAP) for 2023 were RMB 1.29 (USD 0.18), compared to a loss of RMB 0.44 in 2022[33] - Diluted adjusted earnings per share (non-GAAP) for 2023 were RMB 1.26 (USD 0.18), compared to a loss of RMB 0.44 in 2022[33] - Basic adjusted earnings per ADS (non-GAAP) for 2023 were RMB 12.94 (USD 1.82), compared to a loss of RMB 4.42 in 2022[33] - Diluted adjusted earnings per ADS (non-GAAP) for 2023 were RMB 12.65 (USD 1.78), compared to a loss of RMB 4.42 in 2022[33] - Net profit attributable to Huazhu Group Ltd. (GAAP) for the full year 2023 reached RMB 4,085 million, a significant improvement from a loss of RMB 1,821 million in 2022[34] - Adjusted EBITDA (non-GAAP) for the full year 2023 was RMB 6,874 million, compared to RMB 610 million in 2022, reflecting strong operational recovery[34] - Total revenue for Legacy-Huazhu in 2023 was RMB 17,438 million, a 63.7% increase from RMB 10,655 million in 2022[36] Future Growth and Expansion - H World Group expects Q1 2024 revenue growth of 12% to 16% YoY, and full-year 2024 revenue growth of 8% to 12% YoY[4] - H World Group plans to open approximately 1,800 hotels and close around 650 hotels in 2024[5] - For 2024, Huazhu expects revenue growth of 8% to 12% year-over-year, with plans to open approximately 1,800 hotels and close around 650 hotels[19] - Q1 2024 revenue is projected to grow between 12% to 16% compared to Q1 2023[19] - The number of hotels under development as of December 31, 2023, was 3,061, indicating strong future growth potential[38] Key Financial Metrics and Non-GAAP Measures - The company emphasizes the use of EBITDA and adjusted EBITDA as key financial metrics to evaluate operating performance, excluding depreciation, amortization, and equity incentive expenses[22] - Adjusted EBITDA is considered a better reflection of the company's hotel financial performance, excluding equity incentive expenses and gains/losses from fair value changes in equity securities[22] - The company acknowledges that EBITDA and adjusted EBITDA have limitations and should not be considered as substitutes for net income or other GAAP measures[23] - The company provides reconciliations of non-GAAP financial measures, including EBITDA and adjusted EBITDA, to GAAP financial statements[23] Hotel Revenue and Performance by Segment - Revenue from leased and owned hotels in Q4 2023 was RMB 2,288 million, a 48.9% increase from RMB 1,537 million in Q4 2022[35] - Revenue from managed and franchised hotels in Q4 2023 was RMB 1,992 million, a 76.3% increase from RMB 1,130 million in Q4 2022[35] - The average daily rate (ADR) for leased and owned hotels increased by 36.9% year-over-year to RMB 372 in 2023[40] - The occupancy rate for leased and owned hotels rose by 18.9 percentage points to 82.8% in 2023[40] - The revenue per available room (RevPAR) for leased and owned hotels surged by 77.4% year-over-year to RMB 308 in 2023[40] - The RevPAR for economy hotels increased by 44.4% year-over-year to RMB 186 in 2023[42] - The ADR for mid-scale and upper mid-scale hotels grew by 21.7% year-over-year to RMB 369 in 2023[42] - The occupancy rate for mid-scale and upper mid-scale hotels rose by 16.2 percentage points to 81.4% in 2023[42] - The total number of hotels increased by 2 to 131 in Q4 2023, with 26,814 rooms[43] - The ADR for leased hotels in Europe increased by 3.1% year-over-year to €118 in Q4 2023[44] - The occupancy rate for leased hotels in Europe rose by 4.7 percentage points to 64.7% in Q4 2023[44] - The RevPAR for leased hotels in Europe increased by 11.2% year-over-year to €76 in Q4 2023[44] - Average daily rate (ADR) for leased and owned hotels increased by 4.6% to €115 in 2023 compared to €110 in 2022[45] - Occupancy rate for leased and owned hotels rose by 8.7 percentage points to 64.7% in 2023 from 56.0% in 2022[45] - Revenue per available room (RevPAR) for leased and owned hotels grew by 20.9% to €74 in 2023 from €61 in 2022[45] Asset and Liability Management - Total assets increased from RMB 61,507 million in 2022 to RMB 63,532 million in 2023, with cash and cash equivalents rising from RMB 3,583 million to RMB 6,946 million[26] - Property and equipment net decreased from RMB 6,784 million in 2022 to RMB 6,097 million in 2023[26] - Operating lease right-of-use assets decreased from RMB 28,970 million in 2022 to RMB 25,658 million in 2023[26] - Total liabilities decreased from RMB 52.704 billion in 2022 to RMB 51.283 billion (USD 7.223 billion) in 2023[28] - Total equity increased from RMB 8.803 billion in 2022 to RMB 12.249 billion (USD 1.725 billion) in 2023[28] Brand Portfolio - The company's brands include Hi Inn, Yitel, HanTing, Ji Hotel, Starway Hotel, Orange Hotel, Orange Crystal Hotel, Manxin Hotel, and others[24]

Financial Performance - Hotel revenue for Q3 2023 increased by 55.1% year-over-year to RMB 23.5 billion, and by 59.2% excluding Steigenberger Hotels GmbH[2] - Total revenue for Q3 2023 grew by 53.6% year-over-year to RMB 6.3 billion (approximately $861 million), exceeding previous guidance of 43% to 47% growth[2] - Net profit attributable to the company for Q3 2023 was RMB 1.3 billion (approximately $183 million), a significant recovery from a net loss of RMB 717 million in Q3 2022[2] - Adjusted EBITDA for Q3 2023 was RMB 2.2 billion (approximately $300 million), compared to RMB 491 million in Q3 2022[2] - Operating profit for Q3 2023 was RMB 1.9 billion (approximately USD 262 million), compared to RMB 500 million in Q3 2022 and RMB 1.4 billion in the previous quarter[11] - The operating profit margin was 30.4%, significantly up from 12.2% in Q3 2022 and 25.0% in the previous quarter[11] - EBITDA for Q3 2023 was RMB 2.1 billion (approximately USD 293 million), compared to RMB 149 million in Q3 2022 and RMB 1.7 billion in the previous quarter[12] - The company reported a year-over-year revenue growth of 61.8% from the Legacy-Huazhu segment, with revenue of RMB 5.1 billion in Q3 2023[7] - The company reported an adjusted net profit of RMB 1,390 million for Q3 2023, compared to an adjusted net loss of RMB 375 million in Q3 2022[25] Hotel Operations - As of September 30, 2023, the company operated 9,157 hotels with a total of 885,756 rooms[4] - The company opened 545 hotels in Q3 2023 and closed 139 hotels during the same period[4] - Legacy-DH had 129 operating hotels with an occupancy rate of 69.0% in Q3 2023, up from 66.1% in Q3 2022[6] - The total number of hotels operated by Huazhu Group as of September 30, 2023, was 9,028, with a net increase of 406 hotels during the quarter[27] - The total number of hotels as of September 30, 2023, was 9,157, with a net increase of 1 hotel during the third quarter[31] - The company temporarily closed 8 hotels in Q3 2023 for brand upgrades or business model changes[28] - The company has 24 hotels under development as of September 30, 2023[31] Revenue Breakdown - Revenue from leased and owned hotels was RMB 3.878 billion (approximately USD 531 million), a year-over-year increase of 43.9% and a quarter-over-quarter increase of 8.0%[8] - Revenue from management franchise and licensed hotels was RMB 2.268 billion (approximately USD 311 million), showing a year-over-year increase of 72.7% and a quarter-over-quarter increase of 22.2%[8] - The average daily rate (ADR) for Legacy-Huazhu hotels in Q3 2023 was RMB 324, up from RMB 254 in Q3 2022[5] - The average revenue per available room (RevPAR) for leased and owned hotels rose by 65.8% year-over-year to RMB 356 in Q3 2023[29] - The average revenue per available room (RevPAR) for economy hotels increased by 40.1% year-over-year, reaching €216 as of September 30, 2023[30] - The average daily rate (ADR) for managed and franchised hotels rose by 37.3% year-over-year, reaching €209 for the same period[30] Cash Flow and Financial Position - In Q3 2023, operating cash inflow was RMB 1.2 billion (approximately $163 million) while investment cash outflow was RMB 2 billion (approximately $282 million) primarily due to the purchase of RMB 1.8 billion in time deposits and financial products[13] - As of September 30, 2023, total cash and cash equivalents amounted to RMB 5.8 billion (approximately $790 million) with restricted cash of RMB 529 million (approximately $73 million)[13] - Total debt and net cash balance as of September 30, 2023, were RMB 5.2 billion (approximately $714 million) and RMB 1.1 billion (approximately $149 million) respectively[13] - The company holds RMB 2.8 billion in time deposits and financial products, including RMB 2 billion in short-term investments, and has available undrawn credit facilities of RMB 2.7 billion[13] - Total current assets increased from RMB 9,178 million on December 31, 2022, to RMB 10,798 million as of September 30, 2023, representing a growth of 17.6%[20] - Cash and cash equivalents rose from RMB 3,583 million to RMB 5,767 million, an increase of 60.7%[20] - Total liabilities decreased from RMB 52,704 million to RMB 48,288 million, a reduction of 8.0%[21] - Total equity increased significantly from RMB 8,803 million to RMB 14,474 million, reflecting a growth of 64.5%[21] - The company reported a short-term debt increase from RMB 3,288 million to RMB 4,234 million, a rise of 28.8%[21] Future Outlook - The company expects Q4 2023 revenue to grow between 41% to 45% year-over-year, or 48% to 52% excluding DH[3] - For Q4 2023, the company expects revenue growth between 41% to 45% compared to Q4 2022, or 48% to 52% growth excluding DH[13] - Huazhu Group plans to expand its market presence by opening 1,000 new hotels in 2024[22] - Huazhu Group plans to open 2,935 new hotels, indicating a strong pipeline for future growth[28] - Future growth strategies include expanding its hotel portfolio and enhancing brand presence in various markets[18] Key Metrics - The occupancy rate for all operating Legacy-Huazhu hotels in Q3 2023 was 85.9%, compared to 76.0% in Q3 2022[5] - The occupancy rate for leased and owned hotels improved by 14.7 percentage points year-over-year to 87.8% in Q3 2023[29] - The average daily rate for leased hotels remained stable at €113, with a year-over-year change of 0.0%[33] - The average occupancy rate for leased hotels increased by 4.0 percentage points year-over-year, reaching 71.4%[33]

Topic 1: Financial Performance - Revenue increased by 15% year-over-year, driven by strong sales in the Asia-Pacific region [1]. - Net profit margin improved to 12%, up from 10% in the previous quarter [2]. - Operating expenses rose by 8%, primarily due to increased marketing and R&D investments [3]. Topic 2: Market Expansion - The company successfully entered two new markets in Europe, contributing to a 20% increase in international sales [4]. - A new distribution center was opened in South America to support regional growth [5]. - Strategic partnerships were formed with local retailers in Southeast Asia to enhance market penetration [6]. Topic 3: Product Development - Launched three new products in the tech segment, which accounted for 25% of total revenue [7]. - R&D spending increased by 10% to accelerate innovation and product differentiation [8]. - Customer feedback on the new product line has been overwhelmingly positive, with a 90% satisfaction rate [9]. Topic 4: Operational Efficiency - Implemented a new supply chain management system, reducing delivery times by 15% [10]. - Automation initiatives in manufacturing led to a 5% reduction in production costs [11]. - Employee training programs were expanded, resulting in a 10% increase in productivity [12]. Topic 5: Sustainability Initiatives - Achieved a 30% reduction in carbon emissions through the adoption of renewable energy sources [13]. - Launched a company-wide recycling program, diverting 50% of waste from landfills [14]. - Committed to achieving net-zero emissions by 2030, with interim targets set for 2025 [15]. Topic 6: Corporate Governance - Appointed two new independent directors to the board, enhancing oversight and strategic guidance [16]. - Conducted a comprehensive review of corporate policies to ensure compliance with global standards [17]. - Shareholder engagement initiatives were strengthened, with a 20% increase in attendance at the annual meeting [18].