H World Group Limited Reports Second Quarter and Interim of 2024 Unaudited Financial Results

Core Insights - H World Group Limited reported a total of 10,286 hotels and 1,001,865 rooms in operation as of June 30, 2024, with significant growth in hotel turnover and revenue in the second quarter of 2024 [1][2][42] - The company achieved an 11.2% year-over-year revenue increase to RMB6.1 billion (US$846 million) in Q2 2024, exceeding previous guidance [1][8] - Net income attributable to H World Group Limited was RMB1.1 billion (US$147 million) in Q2 2024, reflecting a year-over-year increase [1][26] - The company expects to open over 2,200 hotels in 2024, revising its previous guidance of around 1,800 hotels [1][33] Financial Performance - Hotel turnover increased by 15.5% year-over-year to RMB23.4 billion in Q2 2024, with Legacy-Huazhu segment turnover rising by 16.2% [1] - Revenue from the Legacy-Huazhu segment in Q2 2024 was RMB4.8 billion, an 11.1% year-over-year increase, while the Legacy-DH segment revenue was RMB1.3 billion, up 11.6% [8][9] - EBITDA (non-GAAP) for Q2 2024 was RMB1.9 billion (US$255 million), compared to RMB1.7 billion in Q2 2023 [1][28] - Adjusted EBITDA (non-GAAP) for Q2 2024 was RMB2.0 billion (US$280 million), reflecting a year-over-year increase [28] Operational Highlights - Legacy-Huazhu opened 567 hotels in Q2 2024, with a total of 3,294 unopened hotels in the pipeline [2][3] - The average daily room rate (ADR) for Legacy-Huazhu was RMB296 in Q2 2024, down from RMB305 in Q2 2023, while the occupancy rate improved to 82.6% [4][3] - Legacy-DH's ADR was EUR120 in Q2 2024, with an occupancy rate of 68.3%, both showing improvements year-over-year [6][5] Strategic Outlook - The company aims to expand its footprint in the Asia-Pacific and Middle East regions, with a focus on enhancing service excellence and product upgrades [7] - H World anticipates revenue growth of 2%-5% for Q3 2024, or 1%-4% excluding the Legacy-DH segment [33] - The company has initiated a three-year shareholder return plan, with a commitment to distribute up to US$2 billion to shareholders [32]