Shanghai-headquartered hotel chain Huazhu Group reported that net revenues increased 5.5% year-over-year to RMB 3.1 billion (USD 471 million) for the fourth quarter, better than revenue guidance previously announced of 0% to 3%, and decreased 9.1% to RMB 10.2 billion (USD 1.6 billion) for the full year of 2020.
Excluding DH, net revenues for the fourth quarter decreased 3.1% year-over-year, better than our guidance previously announced of a decline of 4 to 7%.
Hotel turnover increased 17.5% year-over-year to RMB 11 billion for the fourth quarter, and decreased 5.6% to RMB 33 billion for the full year of 2020. Excluding DH, hotel turnover increased 13.2% year-over-year for the fourth quarter and decreased 12.5% year-over-year for the full year of 2020.
Net income attributable to Huazhu Group Limited was RMB 703 million (USD 108 million) for the fourth quarter of 2020, compared with RMB 619 million for the fourth quarter of 2019 and net loss attributable to Huazhu Group Limited of RMB 212 million in the previous quarter.
Net loss attributable to Huazhu Group Limited was RMB 2.2 billion (USD 336 million) for the full year of 2020. Excluding DH, net income attributable to Huazhu Group Limited was RMB 1.0 billion for the fourth quarter of 2020 and was negative RMB 847 million for the full year of 2020.
A total of 6,789 hotels or 652,162 hotel rooms in operation as of December 31, 2020.
Legacy Huazhu highlights
ADR of the Legacy-Huazhu hotels (excluding overseas subsidiary Deutsche Hospitality) was RMB 231 in the fourth quarter of 2020, compared with RMB 232 in the fourth quarter of 2019 and RMB 218 in the previous quarter. The ADR was RMB 210 for the full year of 2020, compared with RMB 234 for the previous year.
The occupancy rate for all Legacy-Huazhu hotels in operation was 80.6% in the fourth quarter of 2020, compared with 82.2% in the fourth quarter of 2019 and 82.0% in the previous quarter. The occupancy rate was 71.0% for the full year of 2020, compared with 84.4% for the previous year.
Blended RevPAR was RMB 186 in the fourth quarter of 2020, compared with RMB 191 in the fourth quarter of 2019 and RMB 179 in the previous quarter. Blended RevPAR was RMB 149
for the full year of 2020, compared with RMB 198 for the previous year.
Legacy DH highlights
Deutsche Hospitality had 38 hotels in the pipeline, including 26 leased and owned hotels and 12 manachised and franchised hotels.
The ADR was EUR76 in the fourth quarter of 2020, compared with EUR97 in the fourth quarter of 2019 and EUR93 in the previous quarter. The ADR was EUR88 for the full year of 2020, compared with EUR97 for the previous year.
The occupancy rate for all Legacy-DH hotels in operation was 22.5% in the fourth quarter of 2020, compared with 68.0% in the fourth quarter of 2019 and 37.9% in the previous quarter. The occupancy rate was 34.8% for the full year of 2020, compared with 69.1% for the previous year.
Blended RevPAR was EUR17 in the fourth quarter of 2020, compared with EUR66 in the fourth quarter of 2019 and EUR35 in the previous quarter. Blended RevPAR was EUR31 for the full year of 2020, compared with EUR67 for the previous year.
Ji Qi, Founder, Executive Chairman and CEO of Huazhu commented: “COVID-19 has caused very significant challenges to both our China and European businesses in 2020. However, our China business achieved strong recovery throughout the year, especially in the second half of 2020 despite several resurgences of the COVID-19 pandemic in various regions. In the second half, we achieved over RMB 1.6 billion of adjusted EBITDA for our China business. ”
“More importantly, we continued to expand our hotel network and pipeline, thanks to our dedicated employees, our powerful brand portfolio and solid execution. Although our European business is still being impacted by COVID-19 pandemic, we have continued to advance our digitalization plan. Moreover, we also took the opportunity to streamline our organizational structure to prepare well for future recovery.”
Outlook
In the first quarter of 2021, Huazhu expects net revenues growth to range from an 8% to a 10% increase compared to the first quarter of 2020, or to range from an increase of 61-63% if excluding DH. For the full year of 2021, Huazhu expects the net revenue growth to range from a 50% to 54%, or to range from 50% to 54% if excluding DH.
