Huazhu Group Limited announced preliminary results for hotel operations in the fourth quarter and the full year ended December 31, 2021.
For Legacy-Huazhu business, RevPAR recovery in Q4 2021 was still significantly impacted by several COVID-19 resurgences in China. In terms of monthly breakdown, the RevPAR recovered to 90%, 76%, and 90% of the levels in October, November, and December 2019, respectively.
For the quarter ended December 31, 2021, the occupancy rate was 68.2%, down 12.4 percentage points year on year. Blended RevPAR was RMB 163 in the fourth quarter of 2021, down 12.2% year on year.
Blended occupancy for the whole year was 72.2%, up 1.2 percentage points year on year, falling off 12.2 percentage points compared with 2019.
After continuous business recovery in Q3 2021 thanks to the progress of vaccination campaign and easing of restrictions, Steigenberger Hotels AG and its subsidiaries (“DH”) in Q4 2021 were impacted by tightened governmental control measures and testing requirements due to the third and fourth waves of the COVID-19 pandemic in European countries.
As a result, the recovery trend of DH was disrupted in November 2021, as RevPAR and occupancy numbers declined compared to those in the summer. RevPAR recovery in the near-term is expected to remain under pressure due to the recent Omicron variant. Huazhu believes that the RevPAR recovery trend will quickly resume once the number of COVID cases start to decline.
Meanwhile, DH continues its effort to implement a comprehensive cash and cash flow improvement program, especially focusing on personnel cost reduction, process optimization and negotiation of further lease waivers. In addition, government subsidy was received in December 2021.
