事件 5月 17 日公司公告1Q24 业绩，收入 52.8 亿元/+17.8%，归母净利 6.6 亿元/-33.4%，经调整净利7.7 亿元/+100.8%，经调整EBITDA 14.2 亿元/+37.8%。 点评 经营数据：Q1境内行业压力加大情况下表现较好，境外量价同比 均有提升。LH 1Q24 RevPAR 216 元/+3.1%、为 19 年同期121.3%， 恢复度环比Q4+1.5pct，行业淡季压力较大情况下表现持续领先； 拆分量价，OCC 77.2%/+1.6pct、ADR216 元/+3.1%，分别为19 年 同期 95.8%、126.7%；拆分结构，Q1 成熟店整体/经济型/中高端 RevPAR 为19年的123.9%/109.9%/111.4%。DH 1Q24 RevPAR 58 欧 元/+4.5%、恢复至19年同期98.3%；拆分看 OCC 55.8%/+2.3pct， ADR 104 欧元/+0.2%。 美元(元) 成交金额(百万元) Q1 收入增速好于指引，Q2预期增长7~11%。1Q24收入增速较4Q23 50.00 400 业绩公告指引上限16%高1.8pct，其中LH收入42. ...

Investment Rating - The report assigns a "Buy" rating for both US and Hong Kong stocks of the company [3]. Core Views - The company reported Q1 2024 revenue of 5.3 billion RMB, an 18% year-over-year increase, exceeding previous guidance of 12%-16% [5]. - The growth in revenue is primarily driven by new store openings, with franchise revenue increasing by 33% to 2.1 billion RMB and direct hotel revenue increasing by 8% to 3.1 billion RMB [5]. - The adjusted EBITDA for Q1 2024 rose by 38% to 1.4 billion RMB, reflecting a 169% increase compared to Q1 2019 [5]. - The company opened 569 new hotels in China during Q1 2024, significantly surpassing the previous year's total of 264 openings [5]. - The company expects Q2 2024 revenue to grow by 7%-11% [5]. Summary by Sections Financial Performance - Q1 2024 revenue reached 5.3 billion RMB, up 18% year-over-year and 162% compared to Q1 2019 [5]. - Q1 2024 net profit attributable to shareholders decreased by 33% to 660 million RMB, primarily due to the sale of assets in Q1 2023 [5]. - The company forecasts net profits of 4.2 billion RMB, 4.8 billion RMB, and 5.4 billion RMB for 2024, 2025, and 2026 respectively [5]. Operational Metrics - In Q1 2024, RevPAR in China increased by 3% to 216 RMB, while ADR rose by 1% to 280 RMB [5]. - The occupancy rate in China increased by 1.6 percentage points to 77.2% [5]. - The company has a total of 9,684 hotels in operation, with 3,138 hotels in the pipeline [5]. Market Outlook - The report maintains a reasonable value estimate of 35.06 HKD per share and 44.77 USD per ADS, supporting the "Buy" rating [5].

H World Group Limited (HTHT) delivered mixed first-quarter 2024 results, with earnings missing the Zacks Consensus Estimate and revenues beating the same.  The top line grew year over year while the bottom line dwindled.The company’s results reflect solid contributions from its Legacy-Huazhu and Legacy-DH segments, primarily driven by the growth in hotel openings and increased revenue per available room (RevPAR). Furthermore, the effective execution of its Service Excellence-Centric Sustainable Quality Grow ...

H World Group Limited (NASDAQ:HTHT) Q1 2024 Results Conference Call May 19, 2024 9:00 PM ET Company Participants Jason Chen - Investor Relations Director Ji Qi - Chairman Jin Hui - Chief Executive Officer Zou Jun - Executive VP & CFO Conference Call Participants Roland Leung - Bank of America Dan Xu - Morgan Stanley Simon Cheung - Goldman Sachs Lydia Ling - Citi Sijie Lin - CICC Operator Good day, and thank you for standing by. Welcome to H World Q1 2024 Earnings Conference Call. [Operator Instructions] I w ...

Investment Rating - The investment rating for the company is "Buy" [1] Core Insights - The company's performance exceeded expectations, driven by store expansion and franchise income, with domestic performance showing high growth and overseas losses reducing. However, guidance for Q2 2024 is conservative due to a high base effect [3] - The report adjusts the forecast for the company's net profit for 2024, 2025, and 2026 to RMB 4.23 billion, RMB 5.54 billion, and RMB 6.69 billion, reflecting a decrease of 4.53%, 1.39%, and 1.67% respectively [3] - The target price is set at HKD 42.50, based on a 30x PE ratio for 2024 [3] Financial Summary - For Q1 2024, the company reported revenue of RMB 5.278 billion, a year-on-year increase of 17.81%, and an adjusted net profit of RMB 771 million, up 100.78%. Adjusted EBITDA was RMB 1.421 billion, reflecting a 17% increase [3] - The overall RevPAR for Q1 2024 increased by 3.1%, with ADR up by 1.0% and occupancy rate (OCC) up by 1.6 percentage points. Same-store RevPAR increased by 0.9%, with ADR down by 0.6% and OCC up by 1.1 percentage points [3] - The company plans to open over 1,800 new stores in 2024, indicating a strong growth strategy [3] Market Data - The stock price range over the past 52 weeks is between HKD 23.45 and HKD 37.10 [4] - The current market capitalization is HKD 106.906 billion, with a total share count of 3.21 billion shares [4]

Investment Rating - The investment rating for the company is "Buy" [2][3] Core Views - In Q1 2024, the company's revenue exceeded previous guidance, with adjusted net profit doubling. Revenue reached 5.278 billion RMB, up 17.80%, surpassing the guidance of 12-16%. Adjusted net profit was 659 million RMB, a year-on-year increase of approximately 101% [6][9] - The domestic hotel sector's overall REVPAR increased by 3.1%, leading the industry, with rapid store openings contributing to revenue and adjusted profit growth. The company opened a record 569 new stores in Q1 2024, reflecting strong franchisee recognition [6][9] - The company expects Q2 revenue growth of 7-11%, supported by strong brand and operational efficiency, despite potential fluctuations in REVPAR due to high base effects from the previous year [6][9] Summary by Sections Financial Performance - In Q1 2024, the company achieved a revenue of 5.278 billion RMB, a 17.80% increase, and an adjusted net profit of 771 million RMB, marking a 101% year-on-year growth. The decline in net profit was primarily due to foreign exchange fluctuations and previous investment gains [6][9] - The domestic hotel revenue was approximately 4.2 billion RMB, up 18.1%, exceeding the guidance of 11-15%. Adjusted EBITDA and net profit were 1.487 billion RMB and 945 million RMB, respectively, reflecting year-on-year increases of about 32% and 72% [6][9] Market Position - The company leads the domestic hotel industry with a REVPAR increase of 3.1%, outperforming competitors. The overall performance is attributed to timely product updates and efficient operational management [6][9] - The company has a total of 9,817 hotels and 955,657 rooms as of Q1 2024, with a significant portion being franchise-operated [6][9] Future Outlook - The company anticipates a stable revenue growth of 7-11% in Q2 2024, with an annual growth forecast of 8-12%. The growth is supported by ongoing product upgrades and expansion plans, including the opening of 1,800 new stores in 2024 [6][9] - Long-term growth prospects remain strong, with the company positioned as a leader in the Chinese hotel industry, expected to deliver stable growth and capital returns [6][9]

A total of 9,817 hotels or 955,657 hotel rooms in operation as of March 31, 2024.Hotel turnover1 increased 21.1% year-over-year to RMB19.7 billion in the first quarter of 2024. Excluding Steigenberger Hotels GmbH and its subsidiaries ("DH", or "Legacy-DH"), hotel turnover increased 21.6% year-over-year in the first quarter of 2024. Hotel turnover from the Legacy-DH segment increased 15.5% in the first quarter of 2024.Revenue increased 17.8% year-over-year to RMB5.3 billion (US$731 million)2 in the first qua ...

A total of 9,817 hotels or 955,657 hotel rooms in operation as of March 31, 2024.Hotel turnover1 increased 21.1% year-over-year to RMB19.7 billion in the first quarter of 2024. Excluding Steigenberger Hotels GmbH and its subsidiaries (“DH”, or “Legacy-DH”), hotel turnover increased 21.6% year-over-year in the first quarter of 2024. Hotel turnover from the Legacy-DH segment increased 15.5% in the first quarter of 2024.Revenue increased 17.8% year-over-year to RMB5.3 billion (US$731 million)2 in the first qua ...

Hotel Operations - As of March 31, 2024, the company operated 9,817 hotels with a total of 955,657 rooms[3] - As of March 31, 2024, there were 3,172 hotels under development, including 3,138 from Legacy-Huazhu[4] - As of March 31, 2024, Legacy-DH operates 133 hotels with a total of 27,148 rooms, including 16,369 rooms under lease and 10,779 under management and franchise[6] - The company opened 569 hotels in Q1 2024 and closed 148 hotels during the same period[4] - The company temporarily closed 12 hotels in Q1 2024 for brand upgrades and business model changes[31] - The total number of operating hotels under the economy segment is 5,118, with 420,702 rooms available[37] Financial Performance - Total revenue for Q1 2024 grew by 17.8% year-over-year to RMB 5.3 billion (approximately $731 million), exceeding the previous guidance of 12% to 16% growth[3] - Hotel revenue for Q1 2024 increased by 21.1% year-over-year to RMB 19.7 billion, excluding Legacy-DH, the increase was 21.6%[3] - Net profit attributable to the company for Q1 2024 was RMB 659 million (approximately $91 million), compared to RMB 990 million in Q1 2023[3] - Adjusted EBITDA for Q1 2024 was RMB 1.4 billion (approximately $197 million), up from RMB 1.0 billion in Q1 2023[3] - Total revenue for Q1 2024 was RMB 5.278 billion (approximately $731 million), representing a year-over-year increase of 17.8% but a quarter-over-quarter decrease of 5.5%[7] - Revenue from the Legacy-Huazhu segment in Q1 2024 was RMB 4.2 billion, up 18.1% year-over-year, exceeding the previous guidance of 11% to 15%[7] - Revenue from the Legacy-DH segment in Q1 2024 was RMB 1 billion, a year-over-year increase of 16.6%[7] - Operating profit for Q1 2024 was RMB 1 billion (approximately USD 139 million), compared to RMB 664 million in Q1 2023 and RMB 757 million in the previous quarter[12] - The operating profit margin for Q1 2024 was 19.0%, up from 14.8% in Q1 2023 and 13.6% in the previous quarter, driven by increased revenue from management franchise and franchising businesses[12] Cost and Expenses - Operating costs for Q1 2024 were RMB 4.351 billion, compared to RMB 3.890 billion in Q1 2023, primarily due to network expansion and reduced rent waivers[9] - The hotel operating cost for Q1 2024 was RMB 3.6 billion, accounting for 61.6% of revenue, down from 66.3% in Q1 2023[10] - The management franchise and licensing hotel revenue for Q1 2024 was RMB 2.1 billion, a year-over-year increase of 32.8%[8] Cash Flow and Assets - Operating cash inflow for Q1 2024 was RMB 886 million (approximately USD 123 million)[14] - As of March 31, 2024, total cash and cash equivalents amounted to RMB 5.9 billion (approximately USD 818 million) with restricted cash of RMB 755 million (approximately USD 105 million)[14] - Total current assets decreased from RMB 12,056 million on December 31, 2023, to RMB 10,498 million as of March 31, 2024[21] - Cash and cash equivalents declined from RMB 6,946 million to RMB 5,909 million during the same period[21] - Total liabilities decreased from RMB 51,283 million to RMB 49,046 million from December 31, 2023, to March 31, 2024[22] - Total equity increased slightly from RMB 12,249 million to RMB 12,398 million in the same timeframe[22] Future Outlook - The company expects revenue for Q2 2024 to grow between 7% and 11% compared to Q2 2023[4] - The company expects revenue growth of 7% to 11% in Q2 2024 compared to Q2 2023, excluding the DH segment[14] - The company plans to continue expanding its market presence and investing in new technologies and products in the upcoming quarters[23] - The company has made significant investments in lease renovations, which contribute to a substantial portion of its cost structure[17] Non-GAAP Measures - The company utilizes non-GAAP financial measures, including adjusted net profit and adjusted EBITDA, to provide meaningful supplemental information about its performance[16] - EBITDA is considered a useful financial metric for evaluating operational and financial performance before the impact of financing transactions and income taxes[17] - Adjusted EBITDA is believed to better reflect the financial performance capability of the company's hotels[18] - The company emphasizes that EBITDA and adjusted EBITDA should not be viewed as indicators of future performance unaffected by other expenses and income considered outside normal business operations[18] - The limitations of using EBITDA and adjusted EBITDA include the exclusion of depreciation, amortization, income taxes, interest expenses, and incentive compensation costs[18] - The company believes that the use of non-GAAP measures enhances transparency in financial and operational decision-making[16] - The company provides reconciliations of non-GAAP financial measures to GAAP measures in its financial statements for better assessment of performance[18] - The company asserts that adjusted EBITDA allows for year-over-year comparisons by excluding certain costs that may not reflect operational performance[17] Market Position - The company operates 11% of its hotel rooms under the lease and ownership model, while 89% are managed through franchise and management agreements[19] - Huazhu's business model includes leasing, management franchising, and licensing, ensuring standardized operations across all hotels[19] - The company has rights as a major franchisee for brands such as Mercure, Ibis, and Novotel in the Greater China region[19] - Huazhu Group emphasizes its growth strategies and ability to attract and retain guests as key factors for future performance[19]

Core Viewpoint - H World Group Limited (HTHT) is set to report its first-quarter 2024 results on May 17, with previous earnings exceeding the Zacks Consensus Estimate by 6.5% [1] Q1 Estimates - The Zacks Consensus Estimate for HTHT's earnings is 27 cents, reflecting a decline of 38.6% from the prior year [2] - Revenue estimates are pegged at $699 million, indicating a 7.2% increase from the year-ago figure [2] Factors to Note - HTHT's quarterly performance is expected to benefit from a sustained recovery in leisure and business travel demand, along with expansion efforts and strong growth in Average Daily Rate (ADR) and Revenue Per Available Room (RevPAR) [3] - The company has focused on building its brand reputation, which has attracted more customers and contributed to its expansion, particularly in lower-tier cities [3] - However, increased operating costs due to business recovery and higher selling and marketing expenses may negatively impact the bottom line [3] What Our Model Says - The current model does not predict an earnings beat for HTHT, as it has an Earnings ESP of 0.00% and a Zacks Rank of 1 (Strong Buy) [4]