HTHT H World Group Ltd

China Lodging Group, Limited (NASDAQ:HTHT) (“China Lodging Group”, “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 first quarter ended March 31, 2017.

Operating Metrics

	For the quarter ended
	March 31,		December 31,		March 31,
	2016		2016		2017
Occupancy rate (as a percentage)
Leased and owned hotels	82	%	86	%	85	%
Manachised hotels	81	%	85	%	85	%
Franchised hotels	62	%	68	%	66	%
Blended	80	%	85	%	84	%
Average daily room rate (3) (in RMB)
Leased and owned hotels	193		211		204
Manachised hotels	165		178		174
Franchised hotels	169		180		180
Blended	172		186		182
RevPAR (3) (in RMB)
Leased and owned hotels	159		181		174
Manachised hotels	133		152		147
Franchised hotels	105		123		118
Blended	139		158		152
(3) Value-added tax ("VAT") has been implemented for hospitality industry to replace business tax in China, effective May 1, 2016. The Company's room rates quoted and received from customers are tax-inclusive (business tax or VAT) before and after the implementation of VAT. For comparison purposes, the ADR and RevPAR disclosed in this release are based on the tax-inclusive rates.

 

Like-for-like performance for leased and manachised hotels opened for at least 18 months during the current quarter
	As of and for the quarter ended
	March 31,				yoy
	2016		2017		change
Total	2,380		2,380
Leased hotels	579		579
Manachised and franchised hotels	1,801		1,801
Occupancy rate (as a percentage)	83	%	87	%	3.3	%
Average daily room rate (in RMB)	172		175		1.8	%
RevPAR (in RMB)	143		151		5.8	%

Hotel Development

	Number of hotels in operation							Number of rooms in operation
	Opened	Closed (1)		Net added		As of		Net added		As of
	in Q1 2017	in Q1 2017		in Q1 2017		March 31, 2017		in Q1 2017		March 31, 2017
Leased and owned hotels	5	(9	)	(4	)	620		(148	)	78,012
Manachised and franchised hotels	84	(13	)	71		2,716		4,701		257,888
Total	89	(22	)	67		3,336		4,553		335,900
(1) Reasons for closures include contract expiration, operating loss and others.

	Number of hotels in pipeline as of March 31, 2017
Leased hotels	16
Manachised and franchised hotels	457
Total(2)	473
(2) Including 65 hotels under brands of ibis, ibis Styles, Mercure and Novotel.

Business Update by Segment

Hotel breakdown by segment
	Number of hotels in operation
	Net added		As of
	in Q1 2017		March 31, 2017
Economy hotels	39		2,852
HanTing Hotel	22		2,203
Leased hotels	(8	)	478
Manachised hotels	29		1,723
Franchised hotels	1		2
Hi Inn	12		387
Leased hotels			36
Manachised hotels	12		306
Franchised hotels			45
Elan Hotel	3		188
Manachised hotels	2		151
Franchised hotels	1		37
ibis Hotel	2		74
Leased hotels			14
Manachised hotels			12
Franchised hotels	2		48
Midscale and upscale hotels	28		484
JI Hotel	20		304
Leased hotels	3		84
Manachised hotels	16		217
Franchised hotels	1		3
Starway Hotel	5		141
Leased hotels			2
Manachised hotels	5		101
Franchised hotels			38
Joya Hotel			6
Leased hotels			3
Manachised hotels			3
Manxin Hotels & Resorts	1		3
Leased hotels
Manachised hotels			2
Franchised hotels	1		1
ibis Styles Hotel	-		10
Manachised hotels	-1		6
Franchised hotels	1		4
Mercure Hotel	1		16
Leased hotels			2
Manachised hotels	1		13
Franchised hotels			1
Novotel Hotel			2
Leased hotels
Manachised hotels			1
Franchised hotels			1
Grand Mercure	1		2
Leased hotels	1		1
Franchised hotels			1
Total	67		3,336

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
	March 31,		March 31,		yoychange		March 31,		yoychange		March 31,				yoychange
	2016	2017	2016	2017			2016	2017			2016		2017
Economy hotels	2,144	2,144	133	139	5.0	%	159	160	0.8	%	84	%	87	%	3.5	%
Leased hotels	503	503	139	147	5.7	%	167	169	0.9	%	83	%	87	%	3.9	%
Manachised and franchised hotels	1,641	1,641	130	137	4.7	%	155	156	0.8	%	84	%	87	%	3.3	%
Midscale and upscale hotels	236	236	214	233	9.2	%	265	284	6.9	%	81	%	82	%	1.7	%
Leased hotels	76	76	257	279	8.9	%	298	324	8.8	%	86	%	86	%	0.1	%
Manachised and franchised hotels	160	160	182	200	9.5	%	239	252	5.4	%	76	%	79	%	3.0	%
Total	2,380	2,380	143	151	5.8	%	172	175	1.8	%	83	%	87	%	3.3	%

About China Lodging Group, Limited

China Lodging Group, Limited is a leading hotel operator and franchisor in China under 12 brand names. As of March 31, 2017, the Company had 3,336 hotels or 335,900 rooms in operation in 369 cities. With a primary focus on economy and midscale hotel segments, China Lodging Group’s brands include Hi Inn, HanTing Hotel, Elan Hotel, JI Hotel, Starway Hotel, Joya Hotel, and Manxin Hotels & Resorts. 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, manachised and franchised models. Under the lease model, the Company directly operates hotels typically located on leased 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 March 31, 2017, China Lodging Group operates 23 percent of its hotel rooms under lease model, 77 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