Earnings Summary H World Group Limited Reports Third Quarter 2024 Financial Results

Earnings Summary: H World Group Limited Reports Third Quarter 2024 Financial Results

H World Group Limited (NASDAQ: HTHT), a major entity in the global hotel industry, published its unaudited financial statements for the third quarter concluded on September 30, 2024.

Key Financial Metrics:

Interpretation:
The modest year-over-year revenue increase of 2.4% aligns with guidance, driven largely by legacy segment improvements. Revenue remained slightly below the consensus estimates at $918 million. Despite these gains, adjusted EBITDA shows a year-on-year decline of 8.5%, indicating potential cost pressures.

Revenue by Segment:

Interpretation:
The Legacy-Huazhu segment displayed stability with a year-over-year revenue increase within the anticipated range, while Legacy-DH showed robust growth year-on-year but contracted quarter-over-quarter, partly due to one-off restructuring costs.

Key Developments and Operational Highlights:

• H World expanded its hotel network significantly, reaching a total of 10,845 hotels and 1,062,546 rooms globally.
• Legacy-Huazhu opened 774 new hotels during Q3, predominantly within China's lower-tier cities.
• A recorded 10.3% decline in same-hotel RevPAR year-over-year for Legacy-Huazhu, affected by high ADR bases and poor weather conditions.
• Commitment to sustainable growth with a focus on penetrating lower-tier markets and maintaining high occupancy.

Management Commentary:

Jin Hui, CEO, emphasized the strategic expansion of their network across China and progress in lowering costs within European markets through the Legacy-DH segment. Hui highlighted H World's ambition in continuing expansion into APAC and Middle Eastern markets.

Dividends and Share Repurchase:

• Dividends of RMB1.4 billion ($200 million) were paid in Q3.
• Announcements about any new share repurchase programs were not made.

Forward Guidance:

For the fourth quarter of 2024, H World anticipates revenue growth between 1% and 5%, indicating cautious optimism in ongoing recovery and expansion efforts.

Stock Price Movement:

Following the earnings release, H World's stock price decreased by approximately 1.76%.

This detailed review reveals a solid performance from H World Group Limited, with strategic expansion efforts paired with cautious fiscal management, set against a backdrop of volatile but improving market conditions.

For more in-depth analysis and insights, stay tuned with our platform to stay ahead of the market.