H World Group Limited · HKEX:1179
H World — Q4 2024 Earnings Presentation
33 slides from H World's earnings presentation, Mar 20, 2025
Slide 1: Fourth Quarter and Full Year of 2024 Earnings Call
Fourth Quarter and Full Year of 2024 Earnings Call H World Group Limited (NASDAQ: HTHT and HKEX: 1179) March 20, 2025
Slide 2: Agenda
AGENDA 01 02 03 04 2024 Review and 24Q4 and 2024 Q and A Appendix 2025 Focus Operational and Financial Review
Slide 3: Operational Highlights in 2024
3 Operational Highlights in 2024 2024 ‘1,000 Cities, 10,000 Hotels’ Strong Growth Momentum for Milestone the Upper-Midscale Segment Record-High Hotel Openings Increasing Asset-Light Hotel of 2,442 New Hotels Contribution H W or ld
Slide 4: Legacy-Huazhu Hotel Network Expansion Over the Past 10 Years
4 Legacy-Huazhu Hotel Network Expansion Over the Past 10 Years 的 Achieved 10k Hotels Milestone 12,000 Hotels in Operation Hotel Openings 3,500 11,025 3,000 10,000 10,000 2,430 2,500 8,000 2,000 6,000 1,715 1,637 1,641 1,532 1,500 1,244 4,000 835 1,000 737 665 723 607 2,000 500 0 0 2014 2015 2016 201
Slide 5: Legacy-Huazhu Maintained a Stable Occupancy Rate in 2024
5 Legacy-Huazhu Maintained a Stable Occupancy Rate in 2024 2024 ADR (RMB) OCC RevPAR (RMB) -3.2% +0.2p.p. -3.0% 242 299 81.1% 81.2% 235 289 2023 2024 2023 2024 2023 2024 H W or ld
Slide 6: Accelerated Network Expansion
6 Accelerated Network Expansion ꂊ䏅緸絞⸈鸟䪈䓎 Number of Hotel Opening Number of Hotel Closure Number of Hotel in Pipeline Total hotel closure (as of Dec 31) Hotel closure excl. low quality economy soft brand and Hanting 1.0 789 2,430 3,061 668 2,988 1,641 384 273 2023 2024 2023 2024 2023 2024 * Numbers i
Slide 7: Economy and Midscale as the Core Products Serving the Mass Market
7 Economy and Midscale as the Core Products Serving the Mass Market 务 Number of Hotels in Operation Number of Hotels in Pipeline Number of Hotel Opening (as of Dec 31) (as of Dec 31) Economy Midscale Upper midscale and above Economy Midscale Upper midscale and above Economy Midscale Upper midscale a
Slide 8: New Versions Introduced in 2024
8 New Versions Introduced in 2024 2024 H W or ld
Slide 9: Consistent Product Upgrade - Hanting
9 Consistent Product Upgrade - Hanting - Proportion of Hanting 3.5 and Above in Operation Hanting 3.5 and above 36% 21% 10% 3% 1% 2020 2021 2022 2023 2024 * Numbers in this page refers to Legacy-Huazhu business H W or ld
Slide 10: Consistent Product Upgrade - JI
10 Consistent Product Upgrade - JI - Proportion of JI 4.0 and Above in Operation JI 4.0 and above 76% 66% 56% 45% 30% 2020 2021 2022 2023 2024 * Numbers in this page refers to Legacy-Huazhu business H W or ld
Slide 11: Consistent Product Upgrade - Orange
11 Consistent Product Upgrade - Orange - Proportion of Orange 2.0 and Above in Operation Orange 2.0 and above 66% 44% 29% 14% 2021 2022 2023 2024 * Numbers in this page refers to Legacy-Huazhu business H W or ld
Slide 12: Enhancing Presence in the Lower Tier Cities
12 Enhancing Presence in the Lower Tier Cities ⸈䔂⡛絁㙹䋑䋒㽷 Number of Hotels in Operation Number of Hotels in Pipeline City Coverage (as of Dec 31) (as of Dec 31) (hotels in operation and in pipeline) Tier-1 Tier-2 Tier-3, 4 and below Tier-1 Tier-2 Tier-3, 4 and below 11,025 3,061 2,988 9,263 2,000 42%
Slide 13: Stepping-Up the Development of Upper-midscale Segment
13 Stepping-Up the Development of Upper-midscale Segment 鵳♧姿䲀⸓⚥넞咓ㅷ晥涸〄㾝 Number of Upper-midscale Hotels Number of Upper-midscale Hotels Multi-brand Strategy for in Operation in Pipeline Upper-midscale Segment +35% YoY +35% YoY 521 873 386 645 523 287 2022 2023 2024 2022 2023 2024 H W or ld * Numbers
Slide 14: Strengthening Direct B2B Sales Capability
14 Strengthening Direct B2B Sales Capability ⼶⡞㉁假涸♶倗⸈䔂 Direct Room Nights Number of Active Booked via B2B Channels Corporate Clients 27.6mn+ 5,300+ +39% YoY +49% YoY * Numbers in this page refers to Legacy-Huazhu business H W or ld
Slide 15: Rising Membership and CRS Contribution
15 Rising Membership and CRS Contribution ⠔プ錞垷⿺⚥㣛곫㹁⽑嫱䲿⼮ Number of Members Continue Increasing Direct Booking through H World CRS +4.1p.p. YoY +2.2p.p. QoQ 267 66.4% 64.2% 228 199 62.3% 193 169 153 122 103 79 49 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 4Q'23 3Q'24 4Q'24 * Numbers in this pag
Slide 16: Strategic Focus in 2025
16 Strategic Focus in 2025 2025 Grow High-Quality Strengthen Further Pursue Enhance Direct Hotel Network Brand Positioning Asset-Light Strategy Sales Capability • To further penetrate • To establish stronger • To continue pursuing • To optimize H Reward lower-tier cities brand positioning asset-ligh
Slide 17: Legacy-DH RevPAR Increased 5.9% YoY in 2024
17 Legacy-DH RevPAR Increased 5.9% YoY in 2024 DH2024 RevPAR 5.9% ADR (EUR) OCC RevPAR (EUR) +1.5% +2.7p.p. +5.9% 113 114 66.1% 76 63.4% 71 2023 2024 2023 2024 2023 2024 H W or ld
Slide 18: DH - Improving Core Profitability
18 DH - Improving Core Profitability DH • Streamlined headquarters – reduced administration staff by 30%+ • Optimized hotel operations & Improved hotel performance • Started to accelerate asset-light business journey, with 14 L&O hotels removed from our portfolio Revenue Core adj. EBITDA* (RMB milli
Slide 19: DH - 2025 Focus
19 DH - 2025 Focus DH 2025 Hotel Operation Cost Reduction & Asset-Light Enhancement Profit Optimization Transformation • To further improve hotel • The major restructuring in • Recently exited another 11 performance and optimize 2024 to bring cost savings leased contracts hotel operations starting f
Slide 20: Agenda
AGENDA 01 02 03 04 2024 Review and 24Q4 and 2024 Q and A Appendix 2025 Focus Operational and Financial Review
Slide 21: Hotel Network Continues to Expand
21 Hotel Network Continues to Expand ꂊ䏅緸絞䭯絯䪈䓎 Hotel Network Expansion Hotel Turnover (Number of rooms in operation) (in RMB millions) +19% +15% 92,825 1,088,218 80,389 Legacy-DH 7,773 Legacy-DH Legacy-DH 912,444 25,889 7,133 Legacy-DH 26,814 Legacy- Legacy- Legacy- Huazhu Legacy- Huazhu Huazhu 85,05
Slide 22: Steady Revenue Growth in 2024
22 Steady Revenue Growth in 2024 2024 In million RMB 4Q24 4Q23 YoY 3Q24 QoQ 2024 2023 YoY Revenue from Legacy - Legacy-Huazhu revenue increased 9.2% YoY in the 4,787 4,384 9.2% 5,162 -7.3% 19,022 17,438 9.1% Ӫ Huazhu fourth quarter of 2024, beat our guidance on the strong openings of manachised & fr
Slide 23: Increasing Revenue Contribution from Asset-Light Model
23 Increasing Revenue Contribution from Asset-Light Model 鲽餴❡佐Ⰶ⽑嫱䭯絯䲿⼮ H World Revenue Breakdown Legacy-Huazhu Revenue Breakdown Others Others Manachised and franchised hotels Manachised and franchised hotels Leased and owned hotels Leased and owned hotels 2% 2% 2% 3% 35% 40% 43% 49% 63% 58% 55% 48%
Slide 24: Operating Income Achieved RMB5.2 Billion in 2024
24 Operating Income Achieved RMB5.2 Billion in 2024 2024 52 In million RMB 4Q24 4Q23 YoY 3Q24 QoQ 2024 2023 YoY Ӫ Legacy-Huazhu - hotel operating costs decreased 5.3% YoY in 4Q and increased slightly by 3.8% YoY in 2024, slower than the revenue growth as we Hotel operating costs 4,190 3,996 4.9% 3,7
Slide 25: Adjusted EBITDA, Adjusted Net Income and Operating Cash Flow
25 Adjusted EBITDA, Adjusted Net Income and Operating Cash Flow EBITDA In million RMB 4Q24 4Q23 YoY 3Q24 QoQ 2024 2023 YoY Ӫ Legacy-Huazhu adjusted EBITDA increased 31.4% YoY in 4Q and 12.6% YoY in 2024. Excluding impairment loss and the one-off items, Legacy- Adjusted EBITDA* 1,246 1,130 10.3% 2,11
Slide 26: Liquidity Position Update
26 Liquidity Position Update 崨⸓䚍䞔ⲃ刿倝 Cash Balance (incl. Net Cash (incl. Unutilized Time Deposits) Time Deposits) Bank Facilities RMB11.9 bn RMB6.5 bn RMB3.3 bn * As of December 31, 2024 * Cash balance and net cash position includes RMB4.4bn time deposits and financial products H W or ld
Slide 27: Shareholder Return
27 Shareholder Return 肅⚎㔐䫣䞔ⲃ Cash Dividend ~USD770 mn total shareholder return (in USD millions) 500 in 2024, which included • USD500 mn cash dividend • ~USD270 mn share repurchase 300 To consistently distribute cash dividend to shareholders, under our up to USD2 bn 100 100 68 three-year shareholder
Slide 28: Guidance
28 Guidance ⚌絫䭷䒸 Q1 Full Year 2025 2025 Total revenue vs. Q1 2024 Total Revenue vs. 2024 ● Grow 0%-4% ● Grow 2%-6% ● Excluding DH - Grow 3%-7% ● Excluding DH - Grow 5%-9% M&F revenue vs. Q1 2024 M&F Revenue vs. 2024 ● Grow 18%-22% ● Grow 17%-21% Hotel network ● Gross Opening: ~2,300 hotels ● Closure
Slide 29: Agenda
AGENDA 01 02 03 04 2024 Review and 24Q4 and 2024 Q and A Appendix 2025 Focus Operational and Financial Review
Slide 30: Agenda
AGENDA 01 02 03 04 2024 Review and 24Q4 and 2024 Q and A Appendix 2025 Focus Operational and Financial Review
Slide 31: Same-Hotel Operational Data by Segment
31 Same-Hotel Operational Data by Segment ず䏅絑蠒侨䰘 Number of hotels in Same-hotel Same-hotel RevPAR Same-hotel ADR operation Occupancy As of For the quarter ended For the quarter ended For the quarter ended December 31, December 31, December 31, December 31, yoy change yoy change yoy change (p.p.) 202
Slide 32: Same-Hotel Operational Data by Segment
32 Same-Hotel Operational Data by Segment ず䏅絑蠒侨䰘 Number of hotels in Same-hotel Same-hotel RevPAR Same-hotel ADR operation Occupancy As of For the year ended For the year ended For the year ended December 31, December 31, December 31, December 31, yoy change yoy change yoy change (p.p.) 2023 2024 20
Slide 33: Number of Hotels and Rooms
33 Number of Hotels and Rooms ꂊ䏅侨ꆀㄤ䨻ꢂ侨ꆀ As of December 31, 2024 Total Hotels Rooms Unopened hotels in operation in pipeline Economy hotels 5,489 449,763 1,167 HanTing Hotel 4,139 359,475 711 Hi Inn 546 28,680 294 NiHao Hotel 415 31,335 136 Elan Hotel 162 8,018 - Ibis Hotel 223 21,598 17 Zleep Hotels