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Huazhu Announces Its Preliminary Results for Hotel Operation in the Second Quarter of 2018

SHANGHAI, China, July 16, 2018 (GLOBE NEWSWIRE) --

Huazhu Group Limited (NASDAQ:HTHT) (“Huazhu”, or the “Company”), a leading and fast-growing multi-brand hotel group in China, today announced its preliminary results for the hotel operation in the second quarter ended June 30, 2018. 

Operating Metrics

  For the quarter ended
  June 30, March 31, June 30,
  2017 2018 2018
Occupancy rate (as a percentage)    
  Leased and owned hotels 90.8% 85.6% 91.4%
  Manachised hotels 90.8% 84.0% 89.8%
  Franchised hotels 74.4% 69.8% 78.7%
  Blended 90.1% 83.7% 89.6%
Average daily room rate  (in RMB)    
  Leased and owned hotels 232 243 270
  Manachised hotels 188 194 212
  Franchised hotels 203 228 248
  Blended 199 207 226
RevPAR  (in RMB)      
  Leased and owned hotels 211 208 246
  Manachised hotels 171 163 190
  Franchised hotels 151 159 195
  Blended 179 173 203
       


Like-for-like performance for hotels opened for at least 18 months during the current quarter
       
  As of and for the quarter ended  
  June 30, yoy
  2017 2018 change
Total    2,866   2,866  
  Leased and owned hotels   559   559  
  Manachised and franchised hotels   2,307   2,307  
Occupancy rate (as a percentage) 92.0% 92.2% 0.3%
Average daily room rate (in RMB) 196 210 7.5%
RevPAR (in RMB) 180 194 7.9%
       


Hotel Development

  Number of hotels in operation   Number of rooms in operation
  Opened  Closed (1) Net added  As of    Net added  As of 
  in Q2 2018 in Q2 2018 in Q2 2018 June 30, 2018   in Q2 2018 June 30, 2018
Leased and owned hotels   7   (7)   -    673     723   86,231
Manachised and franchised hotels   140   (54)   86   3,230     7,735   307,186
Total   147   (61)   86   3,903     8,458   393,417
(1) Reasons for closures include property-related issues, operating loss and non-comliance issues. As of June 30, 2018, two manachised hotels were temporarily closed for brand upgrade. 


  Number of hotels in pipeline
as of June 30, 2018
Leased hotels   39
Manachised and franchised hotels   800
Total(2)   839
(2) Including 145 hotels under brands of ibis, ibis Styles, Mercure, Grand Mercure and Novotel; 113 hotels under brands of Orange Select and Crystal Orange.

Business Update by Segment

Hotel breakdown by segment    
   
  Number of hotels in operation
  Net added  As of 
  in Q2 2018 June 30, 2018
Economy hotels (7) 2,857
HanTing Hotel (9) 2,236
  Leased hotels (12) 428
  Manachised hotels 3 1,804
  Franchised hotels 0 4
Hi Inn 4 395
  Leased hotels (1) 29
  Manachised hotels 2 317
  Franchised hotels 3 49
Elan Hotel (2) 218
  Manachised hotels 0 188
  Franchised hotels (2) 30
Orange Hotel 0 8
  Leased hotels 0 6
  Manachised hotels 0 1
  Franchised hotels 0 1
Midscale and upscale hotels   93   1,046
JI Hotel 29 452
  Leased hotels 0 91
  Manachised hotels 29 359
  Franchised hotels 0 2
Starway Hotel 4 177
  Leased hotels 0 2
  Manachised hotels 4 145
  Franchised hotels 0 30
Joya Hotel 0 7
  Leased hotels 0 4
  Manachised hotels 0 2
  Franchised hotels 0 1
Manxin Hotels & Resorts 2 17
  Leased hotels 0 3
  Manachised hotels 2 11
  Franchised hotels 0 3
HanTing Premium Hotel 17 45
  Leased hotels 6 17
  Manachised hotels 11 28
Ibis Hotel 7 112
  Leased and owned hotels 2 19
  Manachised hotels 7 51
  Franchised hotels (2) 42
Ibis Styles Hotel  7 23
  Leased hotels 1 1
  Manachised hotels 7 20
  Franchised hotels (1) 2
Mercure Hotel 9 28
  Leased hotels 2 4
  Manachised hotels 7 19
  Franchised hotels 0 5
Novotel Hotel   1 5
  Manachised hotels 1 4
  Franchised hotels 0 1
Grand Mercure  1 6
  Leased hotels 0 1
  Manachised hotels 1 3
  Franchised hotels 0 2
Orange Select 13 127
  Leased hotels 2 48
  Manachised hotels 5 54
  Franchised hotels 6 25
Crystal Orange 3 47
  Leased hotels 0 20
  Manachised hotels 2 18
  Franchised hotels 1 9
Total   86   3,903


Same-hotel operational data by segment                    
  Number of hotels in operation Same-hotel RevPAR   Same-hotel ADR   Same-hotel Occupancy  
  As of For the quarter ended   For the quarter ended   For the quarter ended  
  June 30, June 30, yoy change June 30, yoy change June 30, yoy change
  2017 2018 2017 2018 2017 2018 2017 2018
Economy hotels   2,406   2,406   161   174 8.0%   172   186 8.1% 94% 94% -0.1%
  Leased hotels   459   459   168   189 12.2%   182   201 10.3% 92% 94% 1.7%
  Manachised and franchised hotels   1,947   1,947   159   170 6.6%   168   181 7.4% 95% 94% -0.7%
Midscale and upscale hotels   460   460   251   269 7.2%   297   312 4.8% 84% 86% 2.0%
  Leased and owned hotels   100   100   313   332 6.1%   345   365 5.5% 91% 91% 0.5%
  Manachised and franchised hotels   360   360   226   243 7.8%   276   289 4.5% 82% 84% 2.5%
Total   2,866   2,866   180   194 7.9%   196   210 7.5% 92% 92% 0.3%

About Huazhu Group Limited
Huazhu Group Limited is a leading hotel operator and franchisor in China. As of June 30, 2018, the Company had 3,903 hotels or 393,417 rooms in operation. With a primary focus on economy and midscale hotel segments, Huazhu’s brands include Hi Inn, HanTing Hotel, Elan Hotel, HanTing Premium Hotel, JI Hotel, Starway Hotel, Joya Hotel, Crystal Orange Hotel, Orange Hotel Select, Orange Hotel and Manxin Hotel. The Company also has the rights as master franchisee for Mercure, Ibis and Ibis Styles, and co-development rights for Grand Mercure and Novotel, in Pan-China region.

The Company's business includes leased and owned, manachised and franchised models. Under the lease and ownership model, the Company directly operates hotels typically located on leased or owned properties. Under the manachise model, the Company manages manachised hotels through the on-site hotel managers it appoints and collects fees from franchisees. Under the franchise model, the Company provides training, reservation and support services to the franchised hotels and collects fees from franchisees but does not appoint on-site hotel managers. The Company applies a consistent standard and platform across all of its hotels. As of June 30, 2018, Huazhu Group operates 22 percent of its hotel rooms under lease and ownership model, 78 percent under manachise and franchise models.

For more information, please visit the Company’s website: http://ir.huazhu.com .

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: The information in this release contains forward-looking statements which involve risks and uncertainties. Such factors and risks include our anticipated growth strategies; our future results of operations and financial condition; the economic conditions of China; the regulatory environment in China; our ability to attract customers and leverage our brand; trends and competition in the lodging industry; the expected growth of the lodging market in China; and other factors and risks detailed in our filings with the Securities and Exchange Commission. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements, which may be identified by terminology such as “may,” “should,” “will,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “forecast,” “project,” or “continue,” the negative of such terms or other comparable terminology. Readers should not rely on forward-looking statements as predictions of future events or results.

The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.

Contact Information
Investor Relations
Tel: 86 (21) 6195 9561
Email: ir@huazhu.com
http://ir.huazhu.com

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