HWORLD(HTHT) - 2022 Q1 - Quarterly Report

Hotel Operations - As of December 31, 2021, Huazhu operated a total of 7,830 hotels and 753,216 hotel rooms[1][11] - The company opened 1,507 manachised and franchised hotels in 2021, while closing 451[11] - The company operates 7,830 hotels with 753,216 rooms in 17 countries as of December 31, 2021, with 14% of rooms under lease and ownership model and 86% under manachise and franchise models[82][83] - The company had 2,571 unopened hotels in the pipeline as of December 31, 2021[106] - The total number of unopened hotels in the pipeline as of December 31, 2021, was 1,206, indicating ongoing market expansion[119] Financial Performance - Revenue for Q4 2021 was RMB3.4 billion (US$526 million), a 9.1$2.0 billion), a 25.4% year-over-year increase[3][24] - Revenue for the full year of 2021 was RMB12.8 billion (US$2.0 billion), representing an increase of 25.4$72 million), compared to a net income of RMB703 million in Q4 2020[4] - Net loss attributable to Huazhu Group Limited for the full year of 2021 was RMB465 million (US$73 million)[52] - Total revenue for the year ended December 31, 2021, was RMB 12,787 million, representing a 25.5$43 million), compared to RMB375 million in Q4 2020; for the full year 2021, it was RMB1.6 billion (US$247 million) compared to negative RMB244 million in 2020[8] - EBITDA (non-GAAP) for the full year of 2021 was RMB1.4 billion (US$215 million), compared with a negative RMB631 million in 2020[57] - Hotel operating costs for the full year of 2021 were RMB11.3 billion (US$1.8 billion), compared to RMB9.7 billion in 2020[34] - Operating costs for the year ended December 31, 2021, totaled RMB 13,613 million, an increase from RMB 11,925 million in 2020, reflecting a rise of 14.1$1.3 billion), representing an increase of 17.5% from 2020[27] - Revenue from manachised and franchised hotels for the full year of 2021 was RMB4.4 billion (US$690 million), representing an increase of 40.2$136 million) and for the full year 2021 was RMB1.3 billion (US$210 million), representing a 120.4$803 million) with total debt balance of RMB9.8 billion (US$1.5 billion)[61] - Total current assets as of December 31, 2021, were RMB 9,553 million, a decrease from RMB 12,882 million as of December 31, 2020[86] - The company’s total assets as of December 31, 2021, were RMB 63,269 million, a decrease from RMB 65,155 million as of December 31, 2020[87] Future Outlook - For Q1 2022, Huazhu expects revenue growth of 11%-15% compared to Q1 2021, or 1%-5% excluding Legacy-DH[9] - Huazhu expects to open around 1,500 hotels and close 500-550 hotels in 2022, with revenue growth forecasted at 11%-15% for Q1 2022 and 15%-20% for the full year compared to 2021[67] - The guidance for future performance is uncertain due to the ongoing impact of the Omicron variant and China's "zero-COVID" policy[65] Market Conditions - The company maintains a long-term optimistic view on the Chinese lodging industry despite near-term uncertainties due to COVID-19[22] - RevPAR recovery in Q4 2021 was 90%, 76%, and 90% of October, November, and December 2019 levels, respectively, with January and February 2022 showing 75% and 83% recovery[62] Shareholder Information - The company may repurchase its securities, including American depositary shares and convertible notes, subject to market conditions[68] - The company’s share-based compensation expenses for the quarter were 15 million RMB, down from 31 million RMB in the previous quarter[97]