HWORLD(HTHT)2023-11-23 16:00Hotel Operations - As of September 30, 2023, H World Group operated a total of 9,157 hotels and 885,756 hotel rooms[2]. - The total number of hotels as of September 30, 2023, was 9,028, with 545 hotels opened in Q3 2023, netting an addition of 406 hotels[52]. - The company reported a total of 2,935 unopened hotels in the pipeline as of September 30, 2023, indicating ongoing expansion plans[53]. - As of September 30, 2023, the company had 24 unopened hotels in the pipeline for leased hotels[57]. - The company added 2 leased hotels in Q3 2023, bringing the total to 82[57]. - The company has a total of 9,157 operational hotels with 2,970 unopened hotels in the pipeline[60]. Financial Performance - Revenue for Q3 2023 was RMB6.3 billion (US$861 million), a 53.6% year-over-year increase, surpassing the guidance of 43%-47%[3]. - Hotel turnover increased 55.1% year-over-year to RMB23.5 billion in Q3 2023, with a 59.2% increase excluding Legacy-DH[2]. - Net income attributable to H World was RMB1.3 billion (US$183 million) in Q3 2023, compared to a net loss of RMB717 million in Q3 2022[3]. - Adjusted EBITDA (non-GAAP) for Q3 2023 was RMB2.2 billion (US$300 million), up from RMB491 million in Q3 2022[4]. - Operating margin for Q3 2023 was 30.4%, up from 12.2% in Q3 2022 and 25.0% in Q2 2023[22]. - Net income for the quarter was RMB 1,352 million, compared to a net income of RMB 1,036 million in the previous quarter, indicating a growth of approximately 30.4%[47]. - The company reported a comprehensive income of RMB 1,328 million for the quarter, compared to RMB 1,239 million in the previous quarter, an increase of 7.2%[47]. Revenue Sources - Revenue from manachised and franchised hotels in Q3 2023 was RMB2.3 billion (US$311 million), a 72.7% year-over-year increase[16]. - The revenue from leased and owned hotels for the quarter ended September 30, 2023, was RMB 2,748 million, up from RMB 1,793 million in the same quarter of the previous year[51]. - Average daily room rate (ADR) for Legacy-Huazhu was RMB324 in Q3 2023, compared to RMB254 in Q3 2022[7]. - Average daily room rate for leased and owned hotels increased to RMB 406, a 38.1% year-over-year change[54]. - Average daily room rate for manachised and franchised hotels was RMB 314, a 26.4% increase year-over-year[54]. Occupancy and RevPAR - The occupancy rate for Legacy-Huazhu hotels was 85.9% in Q3 2023, up from 76.0% in Q3 2022[8]. - Occupancy rate for leased and owned hotels reached 87.8%, up 14.7 percentage points year-over-year[54]. - Same-hotel RevPAR for economy hotels was RMB 216, a 40.1% year-over-year increase[56]. - RevPAR for leased and owned hotels rose to RMB 356, reflecting a 65.8% increase year-over-year[54]. - RevPAR for manachised and franchised hotels increased to RMB 269, a 41.7% year-over-year growth[54]. Costs and Liabilities - Total operating costs in Q3 2023 were RMB4.5 billion, with hotel operating costs representing 52.0% of the quarter's revenue[17]. - Total liabilities increased to RMB 52,704 million from RMB 48,288 million, reflecting a rise of approximately 9.0%[45]. - Total current assets decreased to RMB 9,178 million from RMB 10,798 million, a decline of 15%[45]. - Cash and cash equivalents decreased to RMB 3,583 million from RMB 5,767 million, a drop of 37.8%[45]. - Total debt as of September 30, 2023, was RMB5.2 billion (US$714 million), with net cash of RMB1.1 billion (US$149 million)[28]. Cash Flow and Investments - Operating cash inflow in Q3 2023 was RMB1.2 billion (US$163 million), while investing cash outflow was RMB2.0 billion (US$282 million)[27]. - The company reported a cash increase of RMB 5,217 million at the end of the period, compared to RMB 4,680 million at the beginning of the period[49]. - The company’s cash flow from financing activities showed a net cash provided of RMB 461 million for the quarter ended June 30, 2023, contrasting with a net cash used of RMB 3,824 million in the previous quarter[49]. Tax and Expenses - Income tax expense in Q3 2023 was RMB421 million (US$59 million), slightly down from RMB434 million in Q3 2022[23]. - The depreciation and amortization expense for the quarter ended September 30, 2023, was RMB 66 million, compared to RMB 59 million in the same quarter of the previous year[51].