H World Posts Q4 Revenue Beat, Projects 6% Revenue Growth For 2025

H World Group Limited HTHT shares are trading higher on Thursday after the company reported fourth-quarter results.

Adjusted earnings per ADS of 14 cents, missed the analyst consensus of 27 cents.
Quarterly sales of $825 million beat the street view of $798.17 million.
Revenue rose by 7.8% year-over-year (Y/Y), exceeding the previously forecasted guidance of an increase of 1% to 5% for the fourth quarter of 2024.
Revenue from the Legacy-Huazhu segment grew by 9.2% Y/Y, aligning with the previously announced 1% to 5% guidance, while revenue from the Legacy-DH segment saw a 2.9% Y/Y increase.
As of Dec. 31, 11,147 hotels and over one million hotel rooms were in operation.
In the quarter, revenue from leased and owned hotels was $462 million, representing a decline of 2.3% Y/Y and 8.6% Q/Q.
Revenue from franchised hotels in the quarter was $342 million, representing a 24% Y/Y growth.
Hotel turnover increased 16.5% Y/Y in the fourth quarter. Adjusted EBITDA reached $171 million in the quarter.

Dividend: The board has approved the declaration and payment of a cash dividend in the aggregate amount of around $300 million, of $0.097 per share, or $0.97 per ADS for the second half of 2024.

The dividend is payable on April 23, 2025 to shareholders of record as on on April 9, 2025.

Buyback: In July 2024, H World introduced a three-year Shareholder Return Plan of up to $2 billion.

For 2024, the Board declared $500 million in cash dividends, and the company repurchased approximately $267 million in shares.

These combined returns total $767 million, exceeding one-third of the plan and accounting for over 80% of the company's free cash flow for the year.

Outlook: As of Dec. 31, the company had cash and cash equivalents of $1.0 billion and restricted cash of $7 million.

For the first quarter, the company anticipates revenue growth of 0%-4% and 3%-7% excluding the DH segment.

For 2025, the company projects revenue growth of 2%-6% or 5%-9% excluding DH.

For 2025, H World anticipates to open around 2,300 hotels and close around 600 hotels.

H World CEO Jin Hui noted that Legacy-Huazhu opened over 2,400 new hotels in 2024. That exceeds the company’s initial target of 1,800 hotels.

”While Legacy-Huazhu’s full-year RevPAR declined slightly year-over-year from a high base last year, Legacy-Huazhu maintained a high occupancy rate of 81.2%, which we believe is encouraging given the speed of our network expansion,” Hui added.

Investors can gain exposure to Alibaba through Invesco Golden Dragon China ETF PGJ and Defiance Hotel, Airline, and Cruise ETF CRUZ.

Price Action: H World Group shares are up 0.80% at $38.36 premarket at the last check Thursday.

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