Slides
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May20, 2025 (NASDAQ: HTHT and HKEX: 1179)H World Group Limited FirstQuarterof 2025Earnings Call
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25Q1 Business Update Q and AAppendix25Q1 Operational and Financial Review 01020304 AGENDA
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H World 216208 ADR (RMB) RevPAR (RMB)OCC 3Legacy-HuazhuRevPAR declined 3.9% YoY⼶⡞⚥㕂2025䎃♧㷍䏞幊ざRevPARず嫱♴徾3.9% -3.9%-1.0p.p.-2.6% 280272 77.2%76.2%
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H World Network Expansionꂊ䏅緸絞䘯鸟䪈䓎Number of Hotel OpeningNumber of Hotel Closure 4 * Numbers in this page refers to Legacy-Huazhu business Number of Hotel in Pipeline 3,1382,865 Q1'24Q1'25 (as of Mar31) 569694 Q1'24Q1'25 148155 72108 Total hotel closureHotel closure excl. low quality economy soft brand and Hanting 1.0
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H World Q1'24Q1'25 EconomyMidscaleUpper midscale and above 5 Number of Hotels in Operation (as of Mar31) 9,68411,564 39% 53% 8%42% 49% 9% Number of Hotels in Pipeline (as of Mar31) Q1'24Q1'25 EconomyMidscaleUpper midscale and above 3,138 47% 37% 16%2,865 39% 22% 39% * Numbers in this page refers to Legacy-Huazhu business Number of Hotel Opening Q1'24Q1'25 EconomyMidscaleUpper midscale and above 569694 49%48% 43%42% 8%10% Economy and Midscale as the Core Products Serving the Mass Market絑崸㘗⿺务咓ꂊ䏅⚹呍䗱剪⸉㣐⠍䋑㖞
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H World +22% YoY +36% YoY Stepping-Up the Development of Upper-midscale Segment * Numbers in this page refers to Legacy-Huazhu business 6 鵳♧姿䲀⸓⚥넞咓ㅷ晥涸〄㾝Number of Upper-midscale Hotels in Operation Number of Upper-midscale Hotels in Pipeline Multi-brand Strategy for Upper-midscale Segment 686873933 Q1'24Q4'24Q1'25 430521523 Q1'24Q4'24Q1'25
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H World Proportion of Hanting3.5 and Above in Operation * Numbers in this page refers to Legacy-Huazhubusiness Proportion of JI 4.0 and Above in Operation Consistent Product Upgrade -Hanting, Ji, Orangeㅷ晥涸䭯絯⼮紩-宪䏭ծⰌ㷍ծ命㶩 Proportion of Orange 2.0 and Above in Operation 25%29%33%36%40% Q1'24Q2'24Q3'24Q4'24Q1'25 Hanting 3.5 and above 69%71%74%76%78% Q1'24Q2'24Q3'24Q4'24Q1‘25 JI 4.0 and above 48%52%63%66%70% Q1'24Q2'24Q3'24Q4'24Q1'25 Orange 2.0 and above
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H World 8 Number of Hotels in Operation Number of Hotels in Pipeline City Coverage(hotels in operation and in pipeline) Q1'24Q1'25 Tier-1Tier-2Tier-3, 4 and below 9,68411,564 42% 18% 40% 41% 17% 42% Q1'24Q1'25 Tier-1Tier-2Tier-3, 4 and below 3,138 35% 11% 54% 2,865 35% 54% 1,290 1,394 2,000 Q1'24Q1'25Future Target Enhancing Presence in the Lower Tier Cities⸈䔂⡛絁㙹䋑䋒㽷 11% (as of Mar31) * Numbers in this page refers to Legacy-Huazhu business (as of Mar31)
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H World * Numbers in this page refers to Legacy-Huazhu business* Includes bookings from H World’s own online channels only, excludes OTAs and other third party distribution platforms Rising Membership and CRS Contribution⠔プ錞垷⿺⚥㣛곫㹁⽑嫱䲿⼮9 Direct Booking through H World CRS 59.7%66.4%65.1% Q1'24Q4'24Q1'25 +5.4p.p.YoYNumber of Members Continues Rising 236245257267277 Q1’24Q2'24Q3'24Q4'24Q1'25
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H World 5865 ADR (EUR) RevPAR (EUR)OCC 10Legacy-DH –Blended RevPAR Increased 12.7% YoYDH 2025䎃♧㷍䏞幊ざRevPARず嫱㟞12.7% +12.7%*+5.3p.p.+2.8% 104107 55.8%61.1% * Numbers in this page refers to Legacy-DHbusiness* The RevPAR increase was helped by mix change of DH's hotel portfolio, and accelerated RevPAR performance in certain regions
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H World DH –Asset-Light Transformation * Numbers in this page refers to Legacy-DHbusiness 11 DH 鲽餴❡⻊ Mix of DH Hotels in Operation 63%62%54% 37%38%46% Q1'24Q4'24Q1'25 LeasedManachised & FranchisedMix of DH Hotels in Pipeline 56%48%43% 44%52%57% Q1'24Q4'24Q1'25 LeasedManachised & Franchised
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25Q1Business Update Q and AAppendix25Q1 Operational and Financial Review 01020304 AGENDA
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H World +14.3% +19.5% 13 (Number of rooms in operation)Hotel Network Expansion(in RMB millions)Hotel Turnover Hotel Network Continues to Expandꂊ䏅緸絞䭯絯䪈䓎 955,657 1,142,158 Q1'24 Q1'25 Legacy-DH27,148Legacy-Huazhu928,509 Legacy-DH25,758 Legacy-Huazhu1,116,400 19,669 22,489 Q1'24 Q1'25 Legacy-DH1,602Legacy-Huazhu18,067 Legacy-DH1,649 Legacy-Huazhu20,840
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H World 14 ♧㷍䏞蠒佐珘⨴㟞Steady Revenue Growth in Q1’25 ӪLegacy-Huazhurevenue increased 5.5% YoY in the firstquarter of 2025, in line with our guidance. Revenue from Huazhu’smanachised& franchised hotels grew 21.1% YoY, at the high-end of our M&F revenue guidance driven by a strong hotel network expansion. ӪLegacy-DH revenue decreased 11.3% YoY in the first quarter of 2025, due to the asset-light transformation as we closed 11 leased hotels in the beginning of the first quarter. Revenue from DH’s manachised& franchised hotels increased 34.8% YoY, driven by both RevPAR growth and a growing M&F network as 10 of the leased hotels were transferred to the franchised model. In million RMB1Q251Q24YoY4Q24QoQRevenue from Legacy -Huazhu4,4814,2465.5%4,789-6.4%-Leased & Owned Hotels1,9132,112-9.4%2,178-12.2%-Manachised& Franchised Hotels2,4722,04221.1%2,4700.1%-Others 96924.3%141-31.9%Revenue from Legacy -DH9181,035-11.3%1,241-26.0%-Leased & Owned Hotels876987-11.2%1,195-26.7%-Manachised& Franchised Hotels312334.8%34-8.8%-Others 1125-56.0%12-8.3%Elimination(4)(3)Nm(7)NmTotal Revenue5,3955,2782.2%6,023-10.4%
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H World 15Increasing Revenue Contribution from Asset-Light Model 鲽餴❡佐Ⰶ⽑嫱䭯絯䲿⼮ 59%52% 39%46% 2%2% Q1'24Q1'25 OthersManachised and franchised hotelsLeased and owned hotels 50%43% 48%55% 2%2% Q1'24Q1'25 OthersManachised and franchised hotelsLeased and owned hotels H World Revenue Breakdown Legacy-HuazhuRevenue Breakdown
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H World 16 ♧㷍䏞絑靈侮た涸EBITDA 鴪ⵌ➃字䋏15➉⯋Adjusted EBITDA Achieved RMB1.5Billion in Q1’25 * Adjusted EBITDA and adjusted net income excludesforeign exchange (gain) loss, net, (gain) loss on disposal of investments,gains/ (losses) from fair value changes of equity securities and share-based compensation expenses In million RMB1Q251Q24YoY4Q24QoQHotel operating costs3,6043,5651.1%4,190-14.0%SG&A expenses 755769-1.8%1,021-26.1%Income from operations1,0821,0037.9%90220.0% In million RMB1Q251Q24YoY4Q24QoQAdjusted EBITDA*1,4961,4215.3%1,24620.1%-Legacy-Huazhu1,5731,4875.8%1,4935.4%-Legacy-DH -77-66-16.7%-24768.8%Adjusted Net Income*775771+0.5%321141.4% ӪHotel operating costs increased slightly by 1.1% YoY in the first quarter of 2025, slower than the revenue growth as we continued transforming to a more asset-light model. ӪSG&A expenses decreased 1.8% YoY in the first quarter of 2025, of which Legacy-Huazhu’sSG&A rose slightly by 1.6% YoY due mainly to an increase in SBC and DH’s SG&A decreased 11.1% YoY thanks to ourrestructuring and cost optimization effort. ӪThe Group’s adjusted net income increased0.5% YoY in the first quarter of 2025, which was dragged primarily by higher income taxes.
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H World 17 Net Cash (incl. Time Deposits)RMB6.5 bn 梡ꆄ崨⿺崨⸓䚍䞔ⲃCash Flow and LiquidityPosition Cash Balance (incl. Time Deposits)RMB11.8bn * As of March31, 2025* Cash balance and net cash position includes RMB3.5bn time deposits and financial products Operating Cash FlowRMB580 mn
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H World 18 ⚌絫䭷䒸Guidance Q22025 Revenue vs. Q22024●Grow 1%-5% ●Excluding DH -Grow 3%-7%M&F revenue vs. Q2 2024●Grow 18%-22%
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Q and AAppendix 01020304 AGENDA 25Q1 Business Update25Q1 Operational and Financial Review
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Q and AAppendix 01020304 AGENDA 25Q1 Business Update25Q1 Operational and Financial Review
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H World 21 Number of hotels in operationSame-hotel RevPARSame-hotel ADRSame-hotel OccupancyAs ofFor the quarter endedFor the quarter endedFor the quarter endedMarch31,March31,yoy changeMarch31,yoy changeMarch31,yoy change (p.p.)2024202520242025 20242025 20242025Economy hotels3,855 3,855 172 156 -9.1%213 201 -5.7%80.8%77.9%-2.9Leased and owned hotels265265 208 188 -9.3%248 231 -6.8%83.7%81.4%-2.2Manachised and franchised hotels3,5903,590 168 153 -9.1%209 197 -5.5%80.5%77.5%-3.0Midscale and Upper midscale hotels3,595 3,595 266 245 -7.9%343 325 -5.3%77.5%75.4%-2.1Leased and owned hotels250250 344 321 -6.8%429 407 -5.0%80.2%78.7%-1.5Manachised and franchised hotels3,3453,345 257 236 -8.1%333 315 -5.4%77.2%75.0%-2.2Total 7,450 7,450 224 205 -8.3%284 269 -5.3%79.0%76.5%-2.5 ず䏅絑蠒侨䰘Same-Hotel Operational Data by Segment * Numbers in this page refers to Legacy-Huazhubusiness
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H World 22 As of March31, 2025TotalHotels Rooms Unopened hotelsin operationin pipelineEconomy hotels 5,677 464,841 1,123 HanTingHotel 4,269 370,138 699Ni Hao Hotel 453 34,145 118 Hi Inn 594 31,182 284 Elan Hotel 129 7,012 -Ibis Hotel 228 21,707 13 Zleep Hotels 4 657 9 Midscale hotels 4,835 517,060 1,116 JI Hotel 3,092 351,344 756 Orange Hotel 913 97,144 236 StarwayHotel 722 58,502 120 Ibis Styles Hotel 108 10,070 4 Upper midscale hotels 994 132,474 527 Crystal Orange Hotel 267 33,501 142 IntercityHotel 113 19,158 125 CitiGOHotel 34 5,144 4 Manxin Hotel 175 16,239 64 Madison Hotel 157 18,185 115 Mercure Hotel 204 31,319 48 Novotel Hotel 34 7,349 23 MAXX 10 1,579 6 Upscale hotels 152 22,016 112 Blossom House 78 3,749 95 Joya Hotel 7 1,234 1 Grand Mercure Hotel 9 1,825 1 Steigenberger Hotels & Resorts 55 14,621 14 Jaz in the City 3 587 1 Luxury hotels 16 2,325 5 Steigenberger Icon 9 1,804 3 Song Hotels 7 521 2 Others 11 3,442 5 Other hotels 11 3,442 5 Total 11,685 1,142,158 2,888 ꂊ䏅侨ꆀㄤ䨻ꢂ侨ꆀNumber of Hotels and Rooms