H World Announces Q2 and Interim of 2023 Financial Results Q2

Turnover Increased 72.0% YOY
Legacy-Huazhu Signed over 1,000 New Hotels

HONG KONG, Aug. 25, 2023 /PRNewswire/ -- H World Group Limited ("H World" or "the Group", NASDAQ: HTHT and HKEX: 1179) announced its unaudited financial results in the second quarter and the first half ended June 30, 2023.

Revenue for the first half of 2023 was RMB10.0 billion (US$1.4 billion), representing an increase of 65.1% compared to the first half of 2022. Revenue from Legacy-Huazhu was RMB7.9 billion, which represented a 67.7% year-over-year increase. Revenue from Steigenberger Hotels GmbH and its subsidiaries ("DH", or "Legacy-DH") was RMB2.1 billion, representing a 55.9% year-over-year increase.

H World's Hotel turnover increased significantly by 72.0% year-over-year to RMB20.3 billion in the second quarter of 2023. Excluding DH, hotel turnover raised to 78.1% year-over-year in the second quarter of 2023. Revenue increased 63.5% year-over-year to RMB5.5 billion (US$762 million). Revenue from the Legacy-Huazhu was RMB4.3 billion, representing a 76.6% year-over-year increase, which was a result of the strong recovery in demand for travel, as well as due to the continued product upgrades and operational optimization via the Group's regional headquarters. Revenue growth for both the Group and Legacy-Huazhu exceeded the revenue guidance previously announced. Revenue from the DH segment was RMB1.2 billion, representing a 28.4% year-over-year increase and a 33.5% sequential increase. The year-over-year increase was largely due to the continued recovery of the Group's business, and the sequential increase was mainly due to seasonality. Net income attributable to H World was RMB1.0 billion (US$138 million), compared with net losses attributable to H World of RMB350 million in the second quarter of 2022. EBITDA (non-GAAP) was RMB1.7 billion (US$234 million), compared with a negative RMB213 million in the second quarter of 2022 and RMB1.6 billion in the previous quarter.

As of June 30, 2023, H World's worldwide hotel network in operation totaled 8,750 hotels and 844,417 rooms, including 128 hotels from DH. Legacy-Huazhu had 8,622 hotels in operation and 818,245 hotel rooms in operation. In the second quarter of 2023, Legacy-Huazhu celebrated a historical high signing of over 1,000 new hotels. The ADR was RMB305, compared with RMB218 in the second quarter of 2022, RMB277 in the previous quarter, and RMB236 in the second quarter of 2019. The OCC for all the Legacy-Huazhu hotels in operation was 81.8%, representing a 17.2p.p. year-over-year increase. Blended RevPAR was RMB250, which has recovered to 121% of the Q2 2019 level. When broken down into monthly numbers, the Group's RevPAR in April, May and June 2023 recovered to 127%, 115% and 123% of the 2019 levels of the corresponding months respectively. The ADR of DH increased to EUR117, and the OCC for all DH hotels in operation increased by 7.3 p.p. to 67.1% year-over-year, with blended RevPAR being EUR78.