Q1 2021 Huazhu Group Ltd Earnings Call

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D J and thank you for standing by what's gone for their lives and his group Ltd Q1, 2000 for anyone earnings conference call. At this time all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session.

And that's changing the session you will need to press star 1 on your telephone and we used to be at Pfizer for this conference is being recorded if you require any further assistance. Please press star zero and.

I would now like to hand, the conference over here and speakers against your decent Chen. Thank you. Please go ahead.

Thank you and again good morning, and good evening, everyone. Thanks for joining us today.

I'll come through for 2 groups 2021 first quarter earnings conference call.

<unk> us today is our founder and the CEO, Mr. Qi, our president and Mr. James Lee, Our Chief Digital officer with the Ocean King our CFO, Mr and play out.

Deputy CFO, Mr Li and Mr Yesterday.

Following their prepared remarks management will be available to answer your questions before.

Before we continue please note that for discussion today will include forward looking statements made under the safe Harbor provision of the United States Private and greatest Litigation Reform Act of 90 and 95.

Forward looking statements gainful inherent risks and Earth and cities.

Our results may be materially different from the views expressed today.

And number of potential risks and Earth and cities outside and our public filings with SEC.

<unk> group does not undertake any obligations to update any forward looking statements, except as required by applicable laws on the call. Today. We will also mention adjusted financial measures. During the discussion of our performance reconciliation of those measures to comparable GAAP information can be found in our earnings.

Release that was distributed yesterday.

As a reminder, this conference call is being recorded the webcast of this conference call as well as supplementary slide presentation is available on the <unk> group's website at IR Dot 2 dot com with that now I will turn the call over to Mr. Chi Chi Mr. Qi. Please.

Good morning, and and good evening, everyone and send to you for joining us today.

And do you all know until the beginning of this year.

So D and C O COVID-19, and several cities as opposed to challenge due to the merger.

And the street and the later led to this day local.

Guidance by the government before Chinese new year holiday.

After this more generally on the February well I'm very pleased to see as Joe and recovery in March and patiently and often mention the other People's Congress meeting in Beijing.

What's it was really a PA recovered to 95% of 2019 and March.

Compared to the only for.

2.6% in February and.

And I couldn't use news and Apple and me.

During the Labor day holiday, I really part and call it 25% accrues computer vision, the centuri, though 2019.

In terms of the macro economy.

Despite of the impact of Covid, 19, really see search and see.

We saw China's economic zone remains to do that is.

And in line.

The.

Yeah.

And then.

We saw and G D P and the first quarter.

Achieving 19.3% growth.

Compared to visit to Sun and TNT.

And the 10 point of sleep and Bruce comparatively to 2019.

Other the vaccination and process is taking place so mostly in China.

Confidence and that China's China, China's economic and were for the recover firms epidemic and the driver that goes up and this covenant.

Meantime were also observed more diversified and the demands for the travel experience.

Especially regarding the leisure travel and upscale hotels.

Explorer exploring different opportunities.

And which some details and wherever it is caused by Jean Cui later.

Was that our tune and call it with you and wait to update our rescinded and he's doing them and thank you.

She share tissue.

Channel routine gains if you could share.

Okay.

Excellent.

And definitely the sandwich and the telco, but.

Therefore, it's unclear.

Eastern and I mean.

And you and choices hartzell sample.

And I don't go hartzell, withholds or that and yeah. It is therefore.

Therefore for Russia and that Jim.

Yeah Jamie.

<unk>.

Yes.

For the June yet.

Thanks D G moving toward our business updates I would like to take the opportunity to introduce again, our new finance management team.

The F of auto group. She was the CFO of CGI Group Ltd. A part with the affiliate company from March 2018 to February 2020 from 2014 to early 2016. She served as <unk> executed for Vice Presidents of finance responsible for internal financial management and its chief Financial Officer.

For previous work experience is also include CFO for means group and the financial director of trip Dot Com and she has deep financial and management expertise and the travel and hotel industries in China.

For him and the debit to search for it all early.

Linear and new year total module and so on.

Are these.

And when you sell your day Lemming way module for the sample.

Giro hydrogen share.

And by simple answer there Pat.

<unk> share of friendship for their it.

And that's basically that.

Good day CFO. He has served as chief accounting officer of <unk> Since June 2020, and and Chief Financial Officer of part 2 China region. Since December 2020, before joining <unk>. He was the financial planning and other life as head of Asia Pacific Middle East and North Africa regions of <unk>, Inc.

<unk> said for years and Ali Etonian charter possible guidance Tony.

So versus hospital.

For the pods of Pingo <unk>.

Someone just teaching the surety EG toe holder, who can share the quality control.

Sure Hi, there Tony.

And so <unk> for the.

Miss USA Deputy CFO. She has served that's why for US Vice President of strategic investment and the capital markets. Since March 2016, as a skin charge of modules and vascular and portfolio management globally. Prior to joining <unk>. She was a director of <unk> capital stock investment team.

So share was unchanged for mentioning both G&A and for them and then the cortisol.

And the hostile AGL Chiba GE yoga meeting, we choose for their product and what's involved and elite.

And it's a partial was hungry and Chris because your father and cheese.

Now moving to our business updates first off for I would like to emphasize again and our quality courtyard expansion strategy and.

That's very important for <unk> to have a super large scale growth capability based on quality hotel expansion strategy and is the backbone to support our tools and long term sustainable growth. So.

So that's a genotype <unk> and key solar for them, India and Asia dengue quality. That's was so much and your essentially location from a cash it's also Tunisia, Sudan HFC and.

And the OTC switch and Tonkovich, our team and hygiene with ramping by changing the standard intelligence.

Last quarter, we actually announced a very detailed the definition of our quality hotel and actually things the third quarter last year, we started to cleanup dose low quality hotels, and our portfolio, especially those softer breath.

And we're pushing yards.

Judy and changing thing, Jerry and good a sedan and excuse and useful to you.

Hedging constant change and the ultra and Super Bowl.

Joe just for the fever impact.

Moving to champion and quality for <unk>.

Can you share for <unk> content cause I change outs, which and lids tens Harbour City Hall.

This year, we would not only and continuously improve standard of quality for the hotels in operation, but also gradually improve the quality requirements and standards for pipeline and the new signings specifically for our announced that it is the price due to the lowest advertising share rate.

We observed somewhat some inconsistencies in terms of the quality standards for both cost structure and the new signings and so on.

<unk> and boutique Orla PBR, Congrats again and the also to each year for her good as hedging and Yasuo Frankel and shape with her greater quite diligently and changing.

And the challenge for Us.

It is with.

Could you and we'd switching their sourcing project in simple way balance sheet time team.

For this without among Tradeshow green mortgage loans.

And therefore, we will further improve quality standard for our non franchise the brand by requiring them to reduce the cost structure and we found some quality issues and actually actively reviewing our pipeline to detect and remove those unqualified hotels I need to emphasize again that flattens, the blocking and certainly around the customer centric pricing Paul.

Therefore, we would not only chase for the hotel special speak by sacrificing the quality.

<unk> share of Hartzell, the group, which involved and Garda and find out if any.

Now I will move to our current updates in terms of the recovery. Please turn to page 3.

<unk> I mean.

And so the same day Yogi <unk> orman for.

She and tools and channel.

<unk>, our <unk> machines, which industry revpar for.

Alrighty and Julian tone Cheetah.

And with that.

Well for <unk>, which you Suzanne day issue and.

Regarding the Fujitsu, we are zone, a robot and MBR and junior momentum on our balance sheet solid you show a huge issue show total tissue group.

As mentioned by <unk> earlier, all Revpar recovers recovered strongly after travel traveling restructure and being removed. Since later March Revpar started turned to a positive growth in later April for months of actual recover to the same level for 2019 that trends continues in may as of May 2.2000 and <unk>.

Our revpar growth by 7% and health care, if its time period of 2019.

Business and leisure traveling are recovering steadily.

Asia T cell digests tooling for Hiseq, and so shooting gene the aging to shame on me 2 it's so huge channel for Eagle Tau Biogen Holzschuh, that's a good quotes issued zone.

But ive SKU and it's to remind.

And that there are still some risks interest of COVID-19, and China, and therefore, we will keep our provision measures carefully and.

And a quick the situation happened for our healthy growth and the future.

So 1 quick would you sue them and could you kind of put tone shinji tends to equate for suitable usual tie and the other hand, our DC.

And he likes and Ascension T shirts and suits.

She and quiet shift sales.

Sanctioned and short answer the Revpar growth in case of Towable, RV, each union GCB and <unk>.

Alright and intense.

And if prices hold where early in June and <unk>.

Our Asia and sensitive shelter youll sorts of hope.

So achieving boucher and silver additions into the changes and the challenge.

We observed that the recovery time is different among different city tiers. Please turn to slide 4.

We observe that that's lower tier cities recovered better than higher tier cities and March revpar and tier 3 and below cities had exceed chicken and level 2019 level and in April Revpar and tier 2 cities also exceeded 2019 level, while tier 1 cities are slightly lagging behind and again it shows there.

Resilient economic conditions and lower tier cities.

Womens non that's only approach.

So <unk> and <unk>.

And <unk> genius and the Sanger essentially you call them and things are things on the pilot and the science for Bob simple sanctioned and charge offs.

<unk> it was as simple.

Simple essentially and G charges.

And to ensure that you have in.

Sounds great and sushi and Jeff is that we are just for the hall.

Constant change within sensors, okay, wait and see basis igo.

Our lower tier cities penetration and for the penetration strategy further progressing please turn to page 5 as the end of March 38% of our hotels in operation and are located in the tier 3 and and below cities and a 54% of our pipelines are from lower tier cities, which could lead to more contribution.

From the lower tier cities in the future and.

<unk> March 'twenty for US, we have penetrated into 741 cities in China.

Okay.

Yes.

For Mohan <unk> judicious on the cheaply.

So as yet Jesus regime, Joe at Enbridge day, and Dear John say aside how are you.

Its assortment are you seeing the switching IBM environment and that jumped in.

So simple answer that 2 ways, some nutrients and as Dr.

And we Yamaguchi volume for Windows.

No you know, who and <unk> that we choose them.

Now please turn to slide 6.

Our platform and lower tier cities penetration, we are further exploring new opportunities and the lifestyle hotel satellite firstly for our own brand and Crystal Orange its new flagship store will be soon opening Shanghai assist and new Crystal Orange, a 2.0 version.

We would like to provide and new products to the business travelers from the and lifestyle perspective, with Spider and award services there.

<unk> will provide customers a unique elegant and exquisite lifestyle experiences during their journey he.

And he said well and general ones and the city.

Oh and by the so-called teen Bufano for hardwood she shops and Goldwasser will answer that you are within that and Pat you said.

And Doug.

And this year.

But I think we when insurance, although you'll chew this and for strategic fit.

Now I'll turn it on and change our veterans day.

And since launching the tone and <unk>.

And that's for sure tank chosen and going hand bank loans for say Jonathan.

She and canyon and yet.

Similarly, with group pace that you announced that we recently and conflict and <unk>.

<unk> of Citigroup for hotel.

Such acquisition with further enrich our lifestyle brand portfolio.

Please turn to slide 7.

City goes brand positioning is a lifestyle hotel with funnel targeting younger generations, creating a new concept space with functions of accommodations gatherings leisure shared office and our social networking and the central of the city by year challenges such as illegal competitor here and she mentioned call and higher.

It's funny.

And it is Virginia and the vehicle Greenwood other spot Jordan, the equivalents will waste for chamber Arsenal for guidance, 1 quarter and legends Tony.

Nutrition and that James would you like that.

And our English.

Citigroup pin pads and he can't answer there a pathway for it.

And by Basel III.

And it is red Hot now but for sure.

Sales and scheduled other development at.

Citigroup team had a pattern.

<unk> posted a year for Ya hartzell for Perceval, Fortunately, you dial it couldn't or the potential of other <unk>.

Slide 8 shows some basic information of Citigroup Hotel the brand was established in 2017.

<unk> made the first and as totalled 28 hotels and accretion with over 4800 hotel rooms, covering 13 cities from the latest operating data in April 2021 City goes to Revpar and <unk> achieved RMB 384, and RMB 217, and tier 2 cities, we believe that.

And <unk> strong <unk> strong platform capability.

With further enhances and accelerates for <unk> future development and in return and the brand could help for the English sponsored.

Lifestyle brand and it creates more opportunity for parts and to explore and the lifestyle it at that.

And <unk>.

Suddenly Quito and local smaller.

And the songs and Eve.

And also in that other digest Ria for while.

And Jay vehicles.

Yeah, John cash and yet from this attach and then some growth.

And so the job suitable for Japan.

Yeah and digest.

Yeah. So if you see retention tool causal and by the Saturday.

Net.

Okay.

Cause the core revenue.

Yeah.

Moving to our high end hotel development and last quarter, we announced our joint venture with doing that and we're very pleased to update you that there will be 2 hotels from the JV soon to open in may well be the first us back and Burger brand hotel in China, and other 1 will be the sole hotel.

Both hotels are located in Jinan and <unk>.

Like night, and slide 9 and slide 10 shows some photos of these 2 hotels, we have continued progressing in our high end hotel segment.

And that settlement penetration.

Not only from the joint venture, but also for other brands.

San Jose all those and Haynes, usually with ISI assortment that she also it seems for funding that balance and cost efficiencies.

I will now turn it for 2 locations, we've discussed our risk sensitive Lachlan and direct sales and technology.

Thanks, <unk>, good morning, and and good evening everyone.

Oh no not at this yes.

And technology capabilities are critical elements of flash or set 3 new wins, so far come home and happiness.

We continue to stay put and lot of and took a hill, our member base and strengthen our sales capability together with 40 degradation to our hotel operation.

Please turn to slide 12, our hotel remains a key channel for us to acquire the new mandate.

For the end of March 20, and can you and I would total number increased.

Tariff fell 5% to 117.4 million compared to last year.

More importantly, our sunshine and the lesion contribution acute chooses.

Terry Carl Hi, Ed.

<unk>, 1 percentage and optical.

And you can put a by a percentage point compact and flexible.

Water off 10 day.

We are very pleased to see our Crs contribution for the in line, which migrated from the offline traffic such as and Watson.

Moving to slide 13 during the first quarter, we successfully launched our Edgewood.

And at the Washington, III, a match and <unk>.

And that we saw our M au and increased by 5 I think TD app for our.

Comparing with a 1 month ago, Marbella and domain and the leading position compared to our peers and our monthly actually use it to Tom.

And Oh, and the non hotel group <unk> <unk> and <unk>.

And our membership pre related for.

Relating to our members and the new version of that we believe 8 with food and improve our you Thanksgiving and custom line it has to drive.

Much more active member and include the repurchase in vague.

Moving to slide 14.

And 3 we also immediately accretive and the 1 for online checking function for members.

This is a line function.

Weighted and with our setting second and checking and these are second pick up the cash.

In the hotel search function with QE that finally, calling and checking and check out and sell it for customers, which help them to save a lot of waiting time and improve their overall hotel stay experience.

More importantly, with food and the usage penetration of dysfunction, our hotel could further improve our operational efficiency as the other will be less staff needed for front that we should use that you have cut them for checking and all they do.

We could use it manpower seeming to for that improve our hotel setting.

Last but by and 90 technology application could also lower Jafco stock and equipment for example, with a health check and killing computer skill and we may not be a Mac for.

For recruiting front desk top.

Moving to slide 15.

And maybe thinking that Oh Wow for sales.

And then behind this growth has had a riding lawn and.

And you start self checking account penetration of audits checking with 13 and second attributed to 15.5 percentage.

Package.

So his department.

And we need Huntington your line.

Moving to slide 16.

And considering the impact of the urgency of COVID-19.

And the local planning team with deal acute and very good at and that of our to be built.

At June 9th contributed from the profit attack them.

Meaning with contribution of $9.7 percentage of total room nights.

And the longer come and we believe that our copper to cut them and not only contributing additional 9 to act, but also bring other opportunities for new user activation, we other than the other.

Not a lot of cut and we use that corporate it and come to book, our hotels and know yet our man and early.

And therefore, we see us deal a lot of room to come and when that has just become our XI and DVD Amendment.

Oh and side of this slide.

Our new for them.

And then b to b to allow the false traffic as jacket, which lunch, which launched last quarter.

And I'll also achieved some initial outcome.

We have partnered with <unk>.

Large traffic aggregator App platform.

First quarter suggests that China, mobile and Kindle and D D and so.

We're also very pleased to see this new experiment that contributes and June 9 to use with roughly 303000 and $200 a day in average during the first quarter.

Going forward.

Seek more opportunities more cooperation with them, there and packet traffic platform to food and attracting new land and back.

And more whom night there was a contribution now moving to slide 17.

For I don't know when it is in addition, projecting and European.

D edge.

We are very painful and youll see that we had completed a basic of ITT, Inc. For Qatar and the architecture and the dilution.

We have also rolled out the fact the hotel a pilot project in the Wednesday leap and <unk>.

And then <unk> to do taxes on Wednesday testing that and second 5 well gladly.

For full implantation globally and to the middle.

With that now I'll, let turn the call.

Turkey cash, how Q1 operational and financial growth.

Thank you Ashish and good morning, and good evening to everyone.

Let's move on to our operational and financial review for the first quarter of 2021.

As shown on slide 19.

TV and expanded by 15% and Q1.2021 to 662000 compared to 575000.

In Q1, 2020.

Cooling DH legacy <unk> Hotel group.

And expanded by 18% and year on year to roughly 638000, and Q1.2020 1.

For a hotel turnover.

2021, despite COVID-19 resurgence impacts in China, and prolonged Lockdown and Europe, our total hotel turnover still grow at 66% year on year to RMB 8.2 billion in Q1 'twenty 1.

This is mainly due to our continued network expansion as well as the low base for China's business last year, but unfortunately offset by the high base of th lots for Ya.

D H legacy <unk> hotels to Nova doubled year on year to RMB 7.9 billion in Q1, 'twenty 'twenty 1.

And we recorded and.

10% increase compared to Q1.2019.

Turn to page 20 net.

<unk> planned.

Blended revpar for Q1 was RMB 138, which has been covered 270, 777% of 2019 level. The ADR in Q1, 'twenty 'twenty 1 has reported recovered.

Recovered to 95% of 2019 level to RMB 200, Oh 9 while occupancy in Q1.

Keene percentage point lower compared to the 2019. This was mainly due to the COVID-19, resurgence and and state and local policies and January and February. However, our Revpar started recovering strongly since late March.

Turn to page 21, and left BPH business has been negatively impacted by the second and third wave and damage since September 2020, German government and coastal locked down from last November and it may extend into early June and again.

Therefore, our legacy DH blended revpar for Q1, 'twenty, 1 declined by more than 17% to.

13 euro compared to 2021 Q1.

The ADR dropped by 23% to <unk> 69, and the occupancy dropped by 33 percentage points compared to 2020 and Q1.

On slide 22, the total net revenue grew by 16% year on year to RMB, 2.3 billion in Q1.2021.

Food and D. H, let's see why 2 recorded and 90.69 percentage.

And your growth rate to RMB, 2.2 billion if revenue growth was better than our previous guidance. Thanks to the strong recovery in late March.

And the revenue of Q1 leased and owned revenue decreased by 8% to RMB..1 4 billion, mainly caused by the decrease of leased hotels in Europe.

Excluding the H Lee and on the revenue of Blacks and Quadro grew by 56% and year on year to RMB, 1.3 billion.

Net revenue from mainland China and franchise hotel grew by 93% to RMB 897 million, mainly driven by <unk>.

He only a growth rate of legacy platform.

Due to the significant drop of leased and owned revenue of D. H in Q1, 2020, 1 monetize and franchise revenue contribution and large 239% in Q1 and 2021 compared to 23% in Q1 last year at group level for legacy power tool and our hotel.

Expansion was mainly through S and life model and revenue contribution from management and franchise model also expanded to 41% compared with 35% a year ago.

Now, let's move to the cost and profitability session on slide 23.

In Q1, 2020, 1 and reported operating loss was RMB $575 million narrowed from RMB $857 million in Q1, 2020, but expanded from a quarter ago, because mainly due to the COVID-19 resurgence.

And the state local guidance and China, and also prolonged lockdown and Europe is.

Excluding DH legacy partners operating loss in Q1 was RMB $172 million narrowed by 560 million RMB compared to the loss of 731 million RMB in Q1, 2020.

The hotel operating cost and other operating costs for Q1, 2020.1 was RMB 2.5 billion.

Slides increase compared with last year and we.

Legacy <unk> recorded RMB 2 billion hotel operating cost, indicating a 21% year on year growth.

The increase was mainly attributable to the higher rental costs of the new upscale hotels and higher personnel costs as we keep growing and the hotel network rapidly and higher depreciation and amortization cost which were related to the upscale hotel opening and upgrading of existing.

And hotels.

As we've mentioned in previous quarters.

Our future expansion of upscale hotel with mainly used for life model. Therefore.

Opening cost declined by 81% year on year, and 40% Q on Q2, only RMB $21 million in Q1.2021.

Our SG&A in Q1.2021 increased by 9% 8 year on year to RMB 400, and over 6 million, mainly driven by the increase of legacy module, but offset by cost saving of D. H.

Excluding GH SG&A for lexicon for increased by 31% year on year to RMB 299 minutes.

Increase was mainly attributable to the increase of selling and marketing expenses related to revenue recovery and also the increase of head count for our BD team to support penetration into lower tier cities and also affected by less government.

<unk> booked in the Q1, 'twenty 'twenty, 1 compared to <unk>.

Q1, 2020.

Turn to page 24.

Our adjusted EBITDA loss narrowed to RMB 133 million compared to RMB 700, and all 4 million for the Yieldco.

And what's the main drag for this quarter.

Excluding DH left and what you would have reported a positive adjusted EBITDA of RMB $207 million compared to a loss of RMB $631 million and Q1, 2020.

And this quarter in Q1, 'twenty 'twenty, 1 we recorded adjusted net loss of RMB $451 million narrowed from RMB, 1.1 billion a year ago, excluding DH legacy module recorded and adjusted net loss of $115 million.

Compared with 981 million RMB lost in Q1 and 2020.

The non-GAAP pro forma adjustment mentioned on this page excludes unrealized gains and losses from fair value change of equity related to some other investment for example, and Q1, we recorded RMB 238 million sales has increased across shares we hold.

Coming to the cash position.

We kept the net debt of RMB 5.2 billion by the end of Q1, and there's no risk of breaching the financial covenants of the.

1 day and syndication loans.

Our cash balance was.

$5.7 billion RMB and Unutilized bank facilities were $606.5 billion RMB.

This cash and bank facilities will allow for <unk> to further pay down the existing bank debt in 2020, 1 and also to be used for any unforeseen circumstances.

Yeah.

As mentioned in previous presentations, the lockdown and Germany has greatly affect DH business and therefore, the average occupancy of D. H and Q1 was 19% and the rate further dropped to 15% in April and May.

Have you said that daily newly died.

Diagnosed.

Seekers, and Germany are decreasing steadily as of May 22nd about 40% of German had received at least 1 shot vaccine and.

Several regions like Berlin and <unk>.

<unk> restrictions are partially lifted and we expect you'll see more travel for the vaccinated people and Jude.

To compensate the business lost the German government has extended the scope and duration of government subsidy.

Including short time worker compensation and extra government subsidy.

As of April 2021, DH has received.

$12.7 million Euro short time workers compensation, which is expected to further increase as the lockdown and extend.

Additionally, DH has applied for government subsidy to compensate a lot both in 'twenty, and 2020 and 'twenty 1.

The prolonged lockdown was suddenly and coast Pasha DHS revenue for the impact will be partially offset by the government subsidy at the EBITDA level.

We will only record net income upon the recipients of the formal confirmation or such cash.

We also continue to negotiate for rental deduction compared with $5.4 million your wafer cheap in 2020. The year to date waiver of 2021 has amounted to $4.2 million Euro will continue to work on rental and detection for years and.

Number quoted here are related to cash savings, but the P&L impact actually vary depending on the term of waiver.

In addition, we have also put out and staff on temporary furlough frozen our head count and reduced discretionary spending and also capex.

We are also in discussion with local banks and Germany for additional Corona virus age long banks have been supportive to us.

Turning to page 28 for guidance.

For the second quarter of 'twenty 'twenty, 1 we now expect total revenue to grow by 87% to 89% compared to second.

Second quarter of 2020.

Excluding <unk>, we expect the revenue to grow by 90% to 92%.

To provide a more meaningful guidance, we expect total revenue to grow by 27% to 29% compared to the same period of 2019.

Moving BH, the 2020.1 revenue.

2 growth by 20% to 22%.

For the full year of 2021, COVID-19 resurgence in January and February slowed down our hotel open plan and the first quarter.

And so echoing <unk> point previously we've put more emphasize on quality hotel expansion.

We now plan to revise down our non standardized hotel grand opening for the full year.

Considering the above 2 factors will lower our graph opening target of 2021 from 1800, 2 to sound and hotels to 600 to 800 and hotel.

However, even with this died downward adjustment of our growth opening our revenue guidance for electric by 2 remains unchanged at 50% to 54% growth compared to 2020 or 15% to 19% growth compared to 2019 due to the bad.

For the expected Revpar recovery and the Ltd ton impact of the hotel openings in the later part of the year.

The prolonged lockdown period in Germany has caused the recovery much slower than previous expected. Therefore, we adjust the full year group revenue growth guidance to be and the range of 44% for 48% compared to find and 20 or 31 percentage.

35% growth compared to 2019 from previous guidance of 50% to 54% growth compared to 2020, and 36% to 40% growth compared to 2019.

With that let's open up for Q&A. Thank you.

To ask a question you will need to press star 1 on your telephone.

And your question press, the pound or cash.

Your first question comes from the OEM.

From Bank of America.

Okay.

Yeah.

Hello, Good morning, I have 2 questions and first of all just want to ask about the current trends.

And May I think from the presentation, you guys mentioned that the robstown already recovered to 107%.

The 2019 level and.

And just wonder if we exclude the <unk>.

Post holidays Hum.

And we still see positive growth compared to 2019 for it.

The rest of me and also in particular I would like to know a bit more about the trend of the lease and all played out hotel recently.

And then my second question and it's about like the new opening target.

And we understand that and the revised downward.

Opening target and <unk>.

The company pursuing high quality open.

Opening and have the highest standard for their new join us.

And I'm just have a questions off line I think these adjustments has been going for a while and when.

And when do you expect.

The opening page 10.

Salary and again.

And also in particular.

And the new opening target of 16 to 1800 number how.

And how many of them.

So using yourself Brian Maass.

And how many will be using all of my co ops and tech.

Hello, and thank you and good morning management.

And.

Okay.

Oh, the whole time, specifically for Atlantic the ticket growth open of course, and credit kind of outside counsel and those guys.

I seem to each other.

Yeah.

And.

Good for them for the gene for house of Fraser anemia and <unk>.

Hershey.

And she's Virginia, and the U S are you going to appear to chew.

And we tend to the whole women's and goods Homegoods a huge seasons are used for twin peaks and chunky, John and Joe. So he can you kind of cigarettes, and that's 1 where the gene and wafers for the free zone Tusa JP.

And so the Vega Vega Shanxi for you because I think that issue.

Okay. So the overall revpar currency and May we saw it is very satisfactory as we mentioned in the presentation and our amongst 2 day to revpar recovered to over our growth by 7%.

Compared to 2019, even though excluding the 5 days holidays and the beginning of May and the remaining of the day. The Revpar spew achieved for positive growth compared to 2019 zone behavior question, Dara and share gains on the tenders for the.

But D. This is high school you can share.

And John Quealy.

And all.

The weighted Duncan and BG and you should you put it in Asia.

I think gene for your friends at use and simple youre down to the gene and the injunction.

Okay, but we still have to be a little bit more cautious that there was still some of the COVID-19 research just happened and may such as frankly provinces and nursing young.

And normally from our observations and.

Every time, there was a record for resurgence of COVID-19, and where it takes like roughly 2 weeks to recover for the for.

And certainty and good gena for sure and with the boxes. For example genes and then look 1 of the countries, but overall for the recovery trend with humans and our.

A conservatively optimistic perspective for the overall recovery trend.

The other line here, which are eager to go and.

Pinnacle moment for us.

And in junior and ranking either Eli that's in zone, 3 and yeah. That's helpful by Jim and good hygiene, Yeah, AUM and packaging and that you took for it.

And down by channel So youll.

So your pets and good what else the government and the further from here.

And so should the Kaiser.

And certainly pins and he says to hook up and again, it's early time.

For the second question I, just want to mention 1 number to view that for our <unk> brand actually in 2019, we opened up roughly for over 500, Eli during 2019, but this year. We are just planning to open roughly 200, and light, which means and the 3.

And 300 a decline.

So our overall prospective for and a strategist you are concentrating on the quality and hotel expenses and the shocks and the changing Susana <unk> men and women and tweaks for life goes on Carnegie Hall should pay for hiking she couldn't do other tests.

And this is Hal for which you them and the 2 of them and getting them all of them.

For our lower tier cities penetration. So we actually are going to utilize more niihau brands as they standardize the brands to complement our hunting brands for the lower tier cities penetration.

Okay.

Thank you.

Thanks, a lot and thank you.

Right.

Sure.

Your next question comes from <unk> <unk> from CIBC.

And that is open.

Hi, Thank you management.

1 question and then.

Yeah, all the hotel opening Oh, we still call for.

Okay.

Yes.

And the second question.

All right.

By 2 o'clock.

These points and how we finance the acquisition and thank you.

Yeah.

Yes.

Quite a bit.

Chimps and went in and she volume and value.

And <unk> trading tool.

Tony.

And good chance on time and time charter.

And go juices and size and food Hall.

And she got it alright.

Alright, and the institution.

That's all from credit Suisse.

Our total U S government, yeah from credit Suisse.

Mrs.

For the mobile advertising.

For the 10000 hotels in 1000 and cities targets actually we are still progressing through this to achieve these targets are for even though with the COVID-19 impact adjusted using our new signings are gradually being more better compared to last year. Therefore, we are still pretty concrete tuned to the other week without <unk>.

<unk> This 10000 hotels and 1000 and cities by the end of 2022 or later in the first of all other 2023, she's a didactic and those ships would you and sat and listened to the shock and approach and useful for us.

That's a good point.

Chi Tsang Chi yourself.

So for the entire organization.

The other 3 gene.

As a group with GE and vitality and.

The other 2 for she said I put on this is ourself and going in and this is yes.

Further because it's a while.

And you guys put on this at home and do it yourself tool.

So for our large cities penetrating our penetration is actually we're progressing pretty quickly.

And now we.

We have signed up over a 1000 hotels and lower tier cities and in addition to that for our upscale or high and the.

Hotel market.

And over the last year and for after a lot of preparation and turned them off the company actually we are we are also progressing pretty a satisfactory and this area also.

With me and kind of thoughts on board.

She also had its rich.

And <unk> seen the simple advances and inching quietest and excuses on yet and channel endorsing that you said, it's really hard to Ted and good.

Simple answer for them, yet so its unclear to which your attention a BOE a day 3 gene machine for let's say they go with it so it goes on and that's actually in a day.

For sure.

Also we are subsidizing the new consumer the younger generation and other lifestyle hotels documents that the trend is moving up that's why we are exploring into these segments by leveraging our own brands such as Crystal Orange machine and also the currently acquire this illegal brook too for the penetrating this.

And as well.

And so velocity.

Your line.

Okay.

Just wanted to provide a little more color on the city go the entire enterprise value for this acquisition and 750 million RMB and actually imply in terms of the ramp up EBITDA level for the full year perspective.

<unk> and multiple EBITDA multiple is actually in the range of 8 to 9 times, which is a pretty fair and attractive valuation considering this brand's unique position and also the prospect of future growth.

And in terms of a cash source is actually you've noticed that we have more than 10 billion RMB cash available, including also the Unutilized bank facilities. So there's no problem.

For our financing for this acquisition.

Thank you.

Your next question comes from Lena Zhang from HSBC.

Okay.

Hi.

Like management and I wanted to ask a question regarding the new and 2021 for your guidance for <unk>, but.

The total revenue growth of other 2019 remain unchanged and and food.

And I go 15% to 19%, even though the hotel opened these lower than before so I want to ask what is the current revpar assumption for.

Ballpark and fun.

2019, thank you.

So we are positive about the revpar recovery of the hydro side.

And now forecast actually we forecast.

And like Q2, it will be like and 97% and recovery and.

Also in Q3 and Q4, it will be 101, 4 percentage and and 100% recovery compared to 2019 number.

And so.

Okay.

Yeah.

It's a it's a same hotel level perspective.

Because if you're talking about blended revpar and there's a it's a it's a little bit hard to.

And 222 compared with 2019 on the same store level. So if you talk about that and it will be for 2.5 percentage increase for Jen.

General and.

Okay great.

And I'd clarify on same hotel Revpar basis, it's 97% in <unk>, a 100, and Oh, well hunger and for <unk>.

3.2 and 100% in Fujian right.

Yeah, It's a general guidance.

I think yes, certainly we'll keep updating this number.

Okay and.

Does this guidance for revenue growth include contribution from city go acquire.

It is not.

Okay. Thank you.

Your next question comes from Tien Tsin Huang from Th capital. Your line is open.

Yeah.

Yeah, Good morning, and management at a couple of questions why and I look at your 10.

T a C T.

Expansion plan for lower tier cities is going to be a majority part of that pipeline.

Let's say by the end of the year or by the end of next year.

What portion of the Oh, My 2 legacy hotels.

Come from the lower tier cities and yeah.

Tier 3 and below so for the tier 3 and below and also Q1 Q2, what type of difference between Oh.

Sure occupancy rate.

So that's the number 1 question I'm going to finish all the questions.

And second why and how many hotels.

And then Jim Berg and he's going to opening in China. This year and also some hotels, how many oh, yeah. That's the company.

Oh, okay.

And 2 brands.

And then second and third 1 which is the last 1 and in terms of corporate customers. So I saw the copper customer contribution increasing so what is the company's all of the E U.

In terms of the corporate customer contribution in the cold till our revenue that's Matthew question and thank.

Thank you.

And thank you.

D and.

Tito Citigroup.

And then.

And yet.

And that's why aren't you shut it down.

Yeah.

So hopefully we'll for sure.

And it goes away.

So for that channel.

And they go away line a weighted.

Hey, good loans.

Okay.

Okay.

And for that you heard the other ones.

The woman Pvt chicken.

Ladies and girls shirts and shoes.

And the group while she.

And that channel.

And she was with your friendship.

More channel and sales quite thoughts for them.

And yet the short answers for that.

Joe mentioned machines and the like 1 other thing of violence totals for them and do yet and I see.

Thank you and the same thing shop visits.

So these functions releases and send you 1 channel for that.

And with that and that's an issue that put yourself.

Okay.

And as she boxes and your guidance.

Xiaomi, she wants and some who are down and shingles.

Okay.

So we are open other switching them and now that I can see the wind.

And how you.

Yeah.

And how are you you give and teachers and you saw you know women's and Masaki, She council and I'm a common didn't Nico.

Uh huh.

Yeah I can handle.

And they got.

And he got a D R.

Okay.

Okay. Thank you Julie.

Yeah.

And guys John said good.

And.

Good.

For something.

Got it down for a agenda to the gene with Pfizer for sure.

And go quick for sales.

D C is he going to be beside each other.

And that you share issuance and sit there.

And cheap.

Good day.

And you should consider.

We call us and she is and so there's a path.

That's a great summer for example.

And so actually young and that switch.

And so cheap food to share with you on the goods and zone.

The hotels like quite a JV there.

Group up and great Jonathan.

Yeah.

She said.

The chute zone.

For the time element, which is your process.

Swamping and she had called anything back.

And in fact quite knowledgeable Eugene bushy top work, especially the shovels and debt.

So Watson.

The other 1 seamless fashion.

Okay, and I went through the transmission for the first question is for the lower tier cities actually and our slide number 5 we provide some of the numbers and can sell for our a breakdown in terms of our accounting accretion and pipelines argument that we have been putting a lot of airports last year for them because it is for indications actually our pipeline are over 50% of our pipeline.

Income from our tier 3 and and velocities are what's going to help us to for the enlarged our hotel our hotel are from the lower tier cities by year off this year and also in terms of the Revpar growth for instance, I'll go to the lower tier cities and higher tier cities actually are we have been observing that and so that's the lower tier cities.

Actually have a better revpar revpar recovery compared to the higher tier cities are but I think our I think for after the ramp up periods are definitely the lower tier cities and would have slightly lower revpar comfort for the higher tier cities, but for us our take rate will be the Sam and for all.

Tell us no matter, who they are and even higher KC day for North Jersey and for the second question in terms of the JV are for the upcoming years, we have been for the corporate and wish the sooner under the joint venture and and we are going to develop and many are on the stocking and Brooklyn, and the sole hotel brands and currently we have over 30.

Our hotels and pipeline.

And I thought it wasn't good and gaucher against this other turns out to the Vitol and transferred with it So Ya man and going and kind of vocal quadrant homes and people went to.

Yeah.

And with them so that's.

And we're there for that.

Got you I suppose for.

As you May know that the leisure traveling is recovering and growing pretty a pretty good and in China, and we believe and the longer term and skills and a booming and therefore for our high end brands such as stocking programs with some growth on the heels are under the joint venture.

A coffee and stuff.

The future will be.

Well you need to feed that business when I think agenda.

Oh, well and changing tissue.

Right.

And that isn't gundy.

And with China, Ah well count.

And again with the tissues and guidance.

And then you today, she and I think.

Yeah.

Okay.

[noise] and you know with it with that.

For the corporate to customers are actually Oh, that's it is a very important sources for our for the growth growing our traffic.

And we are still very optimistic in terms of their.

Corporate customers growth in the future and more.

More importantly, currently the corporate customers contribute roughly 10% of the total room nights, but out of the 10% over 60% are the room. That's our thoughts were on lifestyle and life channel, which was a very.

It's a very good for us and.

For the future development, we will still leverage our technology our capability.

For the using the tax collection to further develop this year.

Yeah, Dan Schuller warm and tissue for Gwen to Oh, gosh and time.

And Kim.

Got it.

And Cancun.

Well then.

And I.

And I do something.

Yeah.

Channel like.

And contingency.

And <expletive>, Egypt and D.

And with that I think assembly Tam for final for me, we attacked and eating and Joe Johnson and forget about 10, Gigawatts soy audition.

And we we were only up.

Not only focusing on the top 3000 publicly listed companies in China. We are currently.

Penetrating into lower tier cities and leveraging our strong direct sales team to do a lot a lot of local sales and we are planning to penetrate.

Every single day provinces in China This year.

Thank you.

Yeah.

Yeah.

Okay.

Your next question comes from Melody Chan from Jefferies. Your line is open.

Hum.

Thank you for taking my question I have to ask Sean's question Oh.

Sure.

Any other acquisition plan.

And that's right in line with our high quality hotel.

And how and our view on the market.

Thank you.

Yeah.

And so San Diego and she is for Lindsay.

And really showed up and go to your policy for for a woman and Haynesville Tucson, and put them into and put on the 2 contango.

For Oh, sorry, what's your second question, it's himself and the market consolidation.

Okay.

Hello.

Hum and stuff.

And what's our view on the cash.

And our nation.

And I.

And it's Nancy.

About Oh.

Thank you.

Okay.

There's a group of conduct Jacob and showed hunting cooler and I'm looking.

And that's it.

Thank you and 2 pieces the channel globally.

And what isn't good and we don't have them and then the thought of them within zone and 2 is food and go through other parts.

For the cable Onda.

The title.

And so that's 1 for cause releasing nurture with yeah.

Yeah for this.

Children's and capitalization and this was a bulb machine jingle silver Jamie.

And I wish all of US Jim for appeal at the moment, EOG and bonuses or the rodeo and so.

Exactly that's what we're shooting for something attached to them and do it and that's what it was.

So you have it on cable Onda Dorian and is it a function for the.

A deal and when you're dealing with you soon.

This is harper encouraging zynga a woman and.

Gotcha and kind of to go.

We do other changing and Usama.

And also can do this at credit Suisse.

Charter savvy group.

For the poorest starting to the other and that's all doctors offices and.

And good job.

The other thing this is a showcase and see that she said, it's agenda and onboard as our partner and yet all women.

And what other changes you Jesus.

Do you see this and will foster the PMI for me Asia that someone else's bots and Suzhou the goals of the father.

And with that Golar and Guy Junket and do this channel, which is quite anyone is encouraging disease, although she is able to own them.

And so the baton tends to min again and you're good.

Because I know many of whom work.

And to the decoupling and Belgium, but into the whole couldn't meet cause its own watching some shoulder we do.

And what did you want and goes through the dam and this is how and where you could you go to you go to you go to you our changzhou about sure cause other neighborhoods.

Oh God versus other.

And.

Modules and way to each other.

Our competitive strength.

Oh, Okay for the first question, Tim Salt for them and they plan a we always keep our eyes open and we always have and the opening of our future.

We have been discussing with them and they are potential partners.

Well there is no clear our target audience.

And yet so we will be updating you and I'll ask Dr. Something a confirmed okay and in terms of the market and consolidation and competition landscape are actually for the economic segment. So we are doing the penetrating and we got better compared to our peers because the lower tier cities.

Uh huh, so plenty of rooms for penetrating and in terms of the middle skill leveraging on the consumer consumption upgrades and so we will leverage our various brands such as Qi Hotel Orange.

And the newly acquired and city go and the lifestyle brands and to further growing our market share and this area and in terms of the high and and upscale segment, we actually competing and wage dosing International hotel groups, we want to use our core competency such as technology and operational capability.

Great diversified competition competition and trying to grab some market share from them. Thank you.

Thank you.

There are no further questions at this time I would like to hand, the conference back to our speakers.

Yeah.

[noise]. Thank you everyone and for taking time with US today, and we look forward to a call back with you again and in upcoming quarter. Thank you and bye bye.

Yeah.

This concludes today's conference call. Thank you for participating you may now disconnect.

Okay.

[music].

[music].

[music].

[music].

Good day, and thank you for stopping by Broadcom for their wives. This group Ltd, Q1 credit for anyone and earnings conference call. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to address changing day session you will need to press star 1 on your telephone.

Yeah.

This conference is being recorded if you require any further assistance you express side hero.

I'd now like to hand, the conference over here and speakers today, Mr. Decent Chen. Thank you. Please go ahead.

Thank you and good morning, and good evening, everyone. Thanks for joining us today welcome.

We all come true, but you have groups 2021 first quarter earnings conference call.

Joining us today is our founder and CEO, Mr Qi, our president and lift the gateway.

Our chief Digital officer, with the Ocean King our CFO Ms tram bui.

Deputy CFO, Mr adult and and with DSA.

Hey.

Following their prepared remarks management will be available to answer your question.

Before we continue please note that for discussion today will include forward looking statements made under the Safe Harbor provision for United States Private integrating litigation Reform Act of 90 and 95.

Forward looking statements gainful inherent risks and Earth and cheese.

Our results may be materially different from the views expressed for today.

And number of potential risks and Earth Institute.

Our public filings with that D. C. Wacho group does not undertake any obligations to update any forward looking statements, except as real profit applicable laws and.

And our call today, we will also mention adjusted financial measures during the discussion of our performance reconciliation of dose and access to comparable GAAP information can be found in our earnings release and it was distributed yesterday.

As a reminder, this conference call is being recorded and webcast of this conference call as well as supplementary slide presentation is available on <unk> website at IR at <unk> Dot com with that now I will turn the call over to Mr. Chi Chi Mr. Qi. Please.

Good morning, and good evening, everyone. Thank you for joining us today.

Other U R. No until the beginning of this year.

Could you and C. O COVID-19, his favorite cities opposed to challenge you to day lodging history and the letter later Tuesdays day local.

Guidance by the government before Chinese new year holiday.

After 2 small children and the February we are very pleased to see yes, Joe and recovery in March is a patient with opt and nation and there are people as the Congress meeting in Beijing.

What's it was a real pop recovered at 295 percentile for 2019 day in March.

Compared to the only for.

2.6% in February and then it could and use cut and news in April and May.

During the Labor day holiday, a real part of the call. It 25 to Santa Cruz computer vision, the centuri double 2019.

In terms of the macroeconomic <unk>.

And despite of the impact of COVID-19, restate search and see we saw China's economic and remain she does that present a line.

It could.

For the.

Right.

And.

Please be silent with G D P and the first quarter.

COVID-19.3, Santa Cruz compare the visit to Sun and TNT.

And the 10.3% Bruce computer vision 2019.

Other than that but that's the nature and process is taking place and mostly in China.

They have confidence that the China's China, China's economic alert for literally a cover for us at pedantic and drive it across all business travel.

Meantime, we're also opens up to a more diversified and if day minus for the Travelex parents.

Especially regarding the leisure travel and upscale hotels.

And the explorer exploring different opportunities all of which some details that will be discussed by Jean Cui later.

Does that tower too and they call it with you and wait to update our wrists and it didn't steal and thank you.

Oh, that's for sure.

Channel routine gains will keep for sure.

Your line.

And could also launches like this.

And definitely this always seem to go away.

And the third bullet and weight.

And Oh.

I mean, you're going to see hartzell sample.

So she and highest iron a little hard to withhold and God willing to sample.

Yeah, that's helpful because I see it and that Howard and Jim.

Hi, Joanne.

And finally for.

And you'll just.

And your telephone for that yet.

Thanks D G.

Moving to our all our business updates I would like to take the opportunity to introduce again, our new finance management team.

Beltway 8 and a pothole group. She was the CFO of see job growth Ltd off what was a really a company from the March 2018 to February 2020 from 2014 to early 2016. She serves to ask why I chose to execute you for vice Presidents of finance responsible for internal financial management and its chief Financial Officer.

So our previous work experience. It's also includes CFO of Colombia, and his group and the financial director and I'll strip Dot com.

She has deep financial and management expertise and their travel and hotel industries in China.

For him and the.

<unk> said probably too early.

Total module and so on.

And quite used to.

And when you sell your bedroom and way whatsoever.

And what a sample.

Giro Hodges this yeah.

And I said it once a day, yeah, Pat John and Don I figure would be true that tell us that the things she was there Ed.

And that's basically the deputy CFO. He has served as chief accounting Officer, I'll watch listings and fuel in 2020, and and Chief Financial Officer, All watching China region. Since December 2020, if for joining me and module. He was the financial planning and other life as head of Asia Pacific Middle East and and also Africa regions, All packs Econ, Inc.

<unk> for your faith, Audi E mailing me and Shadow Pottsville, and Tony It Hurts us.

Sebastian Hospital attack.

For the buzzword bingo and holds its.

And sometimes there's a gene that city, EG toehold and share the Glen and contour.

Giro bundles of share.

And so <unk> for the.

Yes, yes, a deputy CFO and she has served that's why she was the vice president of strategy and Bachelor and the capital markets. Since March 2016, and charged off watch lists and basketball and portfolio management globally prior to joining and by 2 she was a director of <unk> capital stomach and investment team.

So as you know, Josh well mentioning and bull chunk out for them and then the cortisol.

Good day hardwood AGM.

G E.

We changed for the Teladoc, and what's involved and elite and the.

And so when you consider a module.

Module was hungry and quit because your father and cheese.

Now moving to our business updates first of all I would like to emphasize again all of our quality hotshot expansion strategy and.

It's very important to ballpark for that to have a super large scale growth capability based on quality and hotel expansion strategy and is the backbone to support our tools alongside with attendance and sustainable growth.

So that's what you had a typo and peaceful zoom, India and Asia dengue and the quantity that's for sure.

So once you and yes. Thank you okay.

Cash and it's also Tunisia and deeply damaging you'll.

And she said switch and home to watch our team and hygiene and Blue patching team to attend and intelligence.

Last quarter, we actually announced a very detailed the definition of our quality hotel and actually things the third quarter last year, we started to clean up dose and no quality, Chelsea and our portfolio, especially those softer Brett.

And yeah. So she had to change it would be an interesting thing Jaya and good day.

See the other teasing yarchoan, okay, so you'd say at Ingalls and her chair the yards for years Super Bowl <unk> Joshi for feed up and pack volume.

And if it doesn't what a deep well if I can you share P DRP and pack with you and say.

Colton and I changed out switch and lids tens have we seen channel.

This year, we would not only and continuously improve standards of quality for the hotels in operation, but also graduate and improve the quality recall, my sadness and arts for pipeline and the new signings and specifically for our announced that it is the breadth and due to the loss of the day they share rate we observed.

Some inconsistencies in terms of the quality standards for both cost structure and the new signings.

And so I mentioned and what you're going to developing and I accidentally eligible to each year for her good they are taking hold and saying you have to find a home and shape for her good knowledge of and the gene changed well channel.

And so on the other hartzell.

Could you and wage launching their selection and project into boy filing sheet timeshare.

Oh that for that sit out a model 3.

Rachel Green mortgage comes out.

And therefore, we will further improve quality and send off for our north and size of the brand by requiring them to review the cost structure and we found some quality issues and absolutely actively reviewing our pipeline sweetie Peck and they remove those unqualified hotels I need to emphasize again that watchlist, the blocking and certainly around the customer centric.

Simple. Therefore, we are we would not only chase for the hotel expenses speak by sacrificing the quality.

And you said I have which I always thought graduate rush out lots of the group, which is March and Targa and find out if you're saying.

Now I will move to our current updates and comes off the recovery increased 10, 2 and pastry sales.

And what it is I mean does it.

So the same day, Yogi Tusa and <unk> for men, which is she and tools and channel.

And you can talk about unemployment insurance and she and the sweeping Grubhub group.

Alrighty, each other and intolerant she did.

And your pet.

Yeah, and sensors, which you Suzanne and day issue and Gardena and it gives us a real about Colombia, Argentina, and yet and Sims on our balance sheet Solidago shoe show, where she was and as usual at all day Sushi whipsaw.

As mentioned by teaching earlier, all Revpar recovers recovered strongly after travel travel and restructure and being able to move testing later March Revpar started tend to have positive growth and later April for myself I pro recover to the same level for 2019. The trend continues in May and may 223rd.

Revpar growth by 7% and called care, if it's out of period of 2019 and.

Both business and leisure traveling are recovering steadily now Asia G suite, and Digest and say, it's 1 pool of ICU and sushi eating gene the aging and sushi and Omega threes. So huge other channel upon E E.

And the bulge on whole shoot that's even close issued zone.

But ice SKU and it's true of mine.

You had that there are still some and interest of COVID-19, and China and therefore, we will keep our provision measures and carefully oh.

And cooked and the situation happened for our healthy growth and the future.

So what would you say Oh, my God, you're kind of up a tone.

G Tenancies equivalents will do you also tie and died.

And our D C.

And he and I kind of essentially and she shot into the playful Shanghai Oh, yes, yes.

Thank you and GE and shell, Tennessee, the Revpar growth in case, it's helpful Army each union GCB.

Alright, and intensive price to talk about ardent and Julian towards sheet.

And Tennessee shelter Youll sorts of hope.

So, it's you and bullish and see the DJ and Tennessee that gene sheets, and John and the challenges.

And we observed that the recovering strength is different among different visit tears, please turn to slide for.

And we observed that that's lower tier cities recovered better than higher tier cities, a march revpar and tier 3 and below cities had and exceed 2000 level 2019 level and.

And in April Revpar and tier 2 cities also exceeded 2019 level, while tier 1 cities are slightly lagging behind and again it shows the resilience economic conditions and lower tier cities and it's a woman's I actually thought it hasn't done that salary and push.

And so she teaching C&I up and our team for yet.

It's a junior and Theyre, saying, especially U haul or men and things audience on the pilot and the science about simple would say essentially LNG and charge offs.

And I and literally owns only up islands elusive for simple there. Thank you and GE chats and as well I became Tennessee that Julien, Zhang chocolate and sushi and Jeff <unk> zone.

I'll close with St Jude and sensitive okay wait and she buys for the Eagle.

Our lower tier cities penetration and for the penetration strategy and split it progressing please turn to page 5 at the end of March so the 8% of our hotels in operation and are located in the tier 3 and below cities and a 54% of our pipelines are from lower tier cities, which could lead to more contribution.

Probably the lower tier cities and the future and so.

March 24th we have penetrated into 741 cities in China.

And do you have another $2 billion.

Well module is that gene blood Haynesville, a simple answer judicious how the G quick.

So as yet Jesus was Jean George Index, India, Johns ASI and tell you.

So assortments are you seeing the switching IV and environment and then dropped in.

So simple answer they tell do we saw nutrients and adopt our Tempe.

And you won't go with Ebola and for window there for now.

And you'll recall, it's adding to dawn can wear yoga high teens that we choose them.

Now please turn to slide 6 our platform and lower tier cities penetration, we have for the exploring new opportunities and the lifestyle hotel satellite firstly for our own Brian the Crystal Orange its new flagship store will be soon and opening Shanghai assist and new Crystal Orange, a 2.0 version.

We would like to provide and new products to the business travelers from the and lifestyle perspective with better and the work services.

That's well provides customers a unique elegant and quit exquisite lifestyle experiences during their journey.

He is the 1 which in general and handler technical team and by the so-called team for their hard work, she shops and I'm glad to answer for phones for the Georgia Index and Pat You said Jim.

And this year.

And it wasn't a bad thing way way way and insurance, although you'll chew this and we'll pause for the joint in Melbourne and change our veterans day.

And it turns and it's 1 thing that's hard and <unk> adult.

And that's for sure Hain chosen ankle and handling loans, let's say, Jonathan and Quad mission Canyon and yet.

And <unk>, we're very pleased to announce that we recently and complete the indexation of Citigroup and hotel.

Such acquisition with further enrich our lifestyle brand portfolio and please.

Please turn to slide 7.

City goes brand positioning is a lifestyle hotel was fun targeting younger generations, and creating a new concept space with functions of accommodations gatherings leisure shared office and our social networking and the central of the city by other challenges such as Edibles and bad HCA and she mentioned call.

Tony.

And yet she is Virginia and that we call green more diversified out George and the coupon and school wave for Chamber Arecibo James for Guy, that's 1 of losses languages.

Total inflation and their jeans would you like that.

And iron ore Citigroup and pads.

And I see there a pathway for semi bonds treatment R&D expenses.

Uh huh, nowadays and she did well.

And the challenging and scheduled other developing hat citigroup and pay their father weighted up tenant audits for the pulse of the EAP and Hartzell and festival varsity you dial it couldn't or the potential of other chip.

Slide 8 shows some basic and inflammation of Vidigo Hotel and the brand was established in 2017 as of May the first and ask totalled 28 hotels in operation with over 4800 hotel rooms, covering 13 cities from the latest operating EBITDA in April 2021 cities.

Revpar and <unk> achieved RMB 384, and RMB 217, and tier 2 cities, we believe that <unk> strong watchlist and strong platform capability put further enhanced and accelerated city Gold's future development and in return the brand and could help for the English and talk to US a lifestyle brand.

And it creates more opportunity for volume to exploring the lifestyle and <unk>.

And then.

Satellites 2 of them.

And almost all of them and need for concert.

And largely and that part of our job with it.

And then Jay vehicles CEO, Dr. Jasmine, Zhang Tyson, yet and this edge and that's when the growth of job symbolic of debt.

And we enjoy that.

Yeah, so and that kind of detail here, but do you see it essential tool causal day, both amplify the Saturday.

That went well.

Paula Deen.

Cause Calder and he had a career.

Moving to our high end hotel development and last quarter, we announced our joint venture with <unk>. We are very pleased to update you that there will be 2 hotels from the JV soon open and he may well be the first us back and Burger brand hotel in China, and other 1 will be the sole hotel.

All these hotels are located and genome.

Good night, and slide 9 and slide 10 shows some photos of these 2 hotels.

We have continuous progress and in our high end hotel segment.

Second line penetration not only from the joint venture, but also for other brands.

San Jose all day.

And usually with ISI assortment that is also a change of funding that bats, and wealth businesses.

I will now turn the floor to location and to discuss our regenerative Lachlan and direct sales and technology.

Thanks for Tinkly, good morning, and and good evening everyone.

No not at this yes, and technology capabilities and critical element of flat you said 3 new wind sales will come on line.

Yeah.

We continue to pay for that.

If I took the helm, our member base and it's James and Alex It's Eric.

Capability together with 40 degradation to our hotel operation.

Please turn to slide 12, our hotel.

And the key channel for us to acquire the new mandate by the end of March and <unk> could you win and it took a number increased by 12, 5% to 117.4 million compared to last year.

And importantly, our Sanchez and the lesion contribution acute chooses to Heath, Terry Carl Hi, and sleep.

Can you say what percentage of optical and <unk>.

For the by 8 percentage points come Pat and affect the quality of Huntington.

We are very pleased to see our sea ice contribution for the enlarged which went back weighted clammed up offline chassis Sanchez and Watson.

Moving to slide 13 during the quarter, we successfully launched our Edgewood.

And the <unk> III, a match and <unk>.

For that we saw our MAA, new and increased by 5 percentage <unk> comparing with a 1 month ago Marbella, we I can't and mainly the leading position compared to our peers and our monthly active users and should have them.

And Oh 9 hotels group.

And I mean <unk>.

And <unk>.

And my membership pre related.

Providing to our members and the new wash it off and we believe page with food and improve our youth Thanksgiving and cut and lives.

The drought and much more active member and include GE Pachisi zinc.

Moving to slide 14.

And 3 we also immediately accretive and and allow us to online checking function for members.

And line function and integrated with our second and checking and these are second pick up and killed in the hotel.

Each function with cranes, and finally, culling and to check in and check out and selling for customers.

Which help them to sell a lot of waiting time, and Hayes and cool, Yeah, Oh hotel stay experience.

More importantly, with food and they use each penetration of dysfunction.

Hotel could afford to improve our operational efficiency and we ought to be less staff needed for front that was used that you'll have caused them to and checking and out price either way.

And we could have used this manpower dealing to for that into our hotel is stunning.

Lastly, and 90 technology application could also note the strength of staff and equipment for example, with the self check in kiosk computer and scale it and not earmarked for.

And recruiting front desk staff.

Slide 15.

You May <unk>, Zhang Yeah, Oh, well for thousands of behind this free cash.

Alrighty.

He's done for self checking account penetration of orders and checking with 15 seconds and share that you 15, 5 percentage and we are packaged.

So any comment.

And that's really taking to and he left.

Moving to slide 16.

And considering the impact of this agency of call. It 19 and at the local putting thing with deal acuity and very good and to that of our to be built.

And you'll ninth contributed slammed and attack them.

Oh I see for a meeting with contribution of $9.7 percentage of total room nights silly.

And the longer come and we believe that our copper to cut them and not only contributing at this and no real 92 Hot but also brings and the opportunities for new user activation and we also know and are not a lot of cut and we use they are calculated and call chip.

Our hotels and not yet our man and Ali.

So we see yeah still a lot of room to come and when that's caused them to be.

And our Shouldnt delay demand back.

Oh and side of this slide.

Our new <unk>.

And then b to B to allow the for traffic is Jackie.

And with lunch, which launched it last for quanta.

Well also achieved some initial I have to come and we.

<unk> partners with a large traffic aggregate app platform.

And the classical attacks, such as that China, mobile and Kindle and D D and and so well.

Well also why were pleased to see this new export them and start contributing zoom night to use with roughly 303002 hundred Oligos a D E and age skewing the first quarter.

Going forward.

Seek more opportunities more completion with a very positive traffic platform just for that I check the new land banks and they are more zoom night. So the contribution now.

Now moving.

Moving to slide 17.

For I don't know when it gets and adhesion projecting and European.

And the D edge.

We are very pleased that youll see that we had completed a basic of IP and England checked out and architecture and our solution.

Anyhow also yield out there and what the hotel pilot project in the World the leap.

And then <unk> to do <unk> Zhang.

Wednesday testing that and second 5 well with a gradually you'll ask for full implantation globally and for the middle of it.

With that now I'll, let turn the call to.

Churches cash, how Q1 operational and financial growth.

Thank you.

Thank you Ashish and good morning, and good evening to everyone net.

Moving on to our operational and financial review for the first quarter of 2021.

As shown on slide 19.

Hotel room for expanded by 15% and Q1.2021 30.

662000 compared to 575000.

And in Q1, 2020 is.

Coding D H legacy <unk> Hotel group expanded by 18% and year on year to roughly 638000 in Q1, 2020.1.

While hotel turnover.

For 2021, despite COVID-19 research and impacts in China, and prolonged Lockdown and Europe, Our total hotel turnover still grow at 66% year on year to RMB 8.2 billion in Q1 'twenty 1.

This is mainly due to our continued network expansion as well as the low base for China last year, but unfortunately offset by the high base of DH lofty.

Cutting DH negative watch and hotels to Nova doubled year on year to RMB, 7.9 billion and in Q1 'twenty 'twenty 1.

And we recorded.

10% increase compared to Q1.2019.

Turn to page 20.

Roger and blended Revpar for Q1 was RMB 138, which has been covered 270, 777% of 2019 level. The ADR in Q1, 'twenty 'twenty 1 has reported.

Recovered to 95% of 2019 level to RMB 200, Oh 9 while occupancy in Q1.

Keene percentage point lower compared to the 2019. This was mainly due to the COVID-19, resurgence and state and local policy in January and February However, our revpar starts and recovering strongly since late March.

Turn to page 21, and next PVH business has been negatively impacted by the second and third wave of pandemic since September 2020, German government and coastal locked down from last November and it may extend into early June this year and therefore.

And therefore elected DH blended revpar for Q1, 2021 declined by more than 17% to 30.

13 euro compared to 2021 Q1.

The ADR dropped by 23% to 69 Euro and the occupancy dropped by 33 percentage points compared to 2020 in Q1.

On slide 22, the total net revenue grew by 16% year on year to RMB..2 3 billion in Q1.2021, excluding GH legacy <unk> recorded and 90.69 percentage.

And our growth rate to RMB, 2.2 billion net revenue growth was better than our previous guidance. Thanks to the strong recovery in late March breaking down the revenue of Q1 leased and owned and revenue decreased by 8% to RMB, 1.4 billion mainly caused.

The decrease of leased hotels in Europe.

Excluding the H <unk> and on the revenue of blacks and Quadro grew by 56% and year on year to RMB, 1.3 billion net.

Net revenue from managed and franchised hotel grew by 93% to RMB 897 million, mainly driven by <unk>.

And a growth rate of legacy <unk>.

Due to the significant drop of leased and owned revenue of D. H in Q1, 2020, 1 monetized and franchise revenue contribution and large 239% in Q1, 'twenty 'twenty, 1 and compared to 23% in Q1 last year at a group level for less and quad to our hotel.

And expansion was mainly through asset light model the revenue contribution for <unk> and franchise motto also expanded to 41% compared with 35% a year ago.

Now, let's move to the cost and profitability session on slide 23.

In Q1, 2021 and reported operating loss was RMB $575 million narrowed from RMB $857 million in Q1, 2020, but expanded from a quarter ago, because mainly due to the COVID-19 resurgence and.

And this day local guidance and China, and also prolonged lockdown and Europe.

Excluding DH legacy partners operating loss in Q1 was RMB $172 million narrowed by 560 million RMB compared to the loss of 731 million RMB in Q1.2020.

The hotel operating costs and other operating costs for Q1.2021 was RMB 2.5 billion.

Slides increase compared with last year and we.

Rich legacy QUADRA and recorded RMB 2 billion hotel operating cost, indicating a 21% year on year growth.

The increase was mainly attributable to the higher rental costs of the new upscale hotel and higher personnel costs as we keep growing and the hotel network rapidly and higher depreciation and amortization comp which were related to the upscale hotel opening and upgrading of exist.

And hotels.

As we mentioned in previous quarters.

Our future expansion of upscale hotel were mainly used as a life model and therefore, a pre opening cost declined by 81% year on year and 40% Q on Q2, only RMB $21 million in Q1.2021.

Our SG&A in Q1.2021 increased by 9% 8 year on year to RMB 401, 6 million, mainly driven by the increase of legacy module, but offset by cost saving of D. H.

Excluding GH SG&A for legacy <unk> increased by 31% year on year to RMB 299 minutes.

The increase was mainly attributable to the increase of selling and marketing expenses related to revenue recovery and also the increase of head count for our BD team to support penetration into lower tier cities and also affected by less government.

<unk> booked in the Q1, 2020, 1 compared to <unk>.

Q1.2020.

Turn to page 24.

Our adjusted EBITDA loss narrowed to RMB 133 million compared to RMB 700, and all 4 million a year ago.

And what's the main drag for this quarter.

Excluding DH led to module would have reported a positive adjusted EBITDA of RMB $207 million compared to a loss of RMB $631 million and Q1.2020.

And this quarter in Q1, 2020, 1 we recorded adjusted net loss of RMB $451 million narrowed from RMB, 1.1 billion a year ago, excluding DH legacy module recorded and adjusted net loss of $115 million.

Compared with 981 million RMB lost in Q1.2020.

The non-GAAP pro forma adjustment mentioned on this page exclude and realize the gains and losses from fair value change of equity related to some other investments for example, and Q1, we recorded RMB 238 million sales and increase.

<unk> shares we held.

Coming to the cash condition.

We kept the net debt of RMB 5.2 billion by the end of Q1 and there is no risk of breaching the financial covenants of the U S dollar 1 billion and syndication loans.

Our cash balance was.

And 5.7 billion RMB and Unutilized bank facilities were $606.5 billion RMB.

This cash and bank facilities will allow for <unk> to further pay down the existing bank debt in 2021 and also to be used for any unforeseen circumstances.

As mentioned in previous presentations, the lockdown and Germany has greatly affect DH business and therefore, the average occupancy of D. H and Q1 was 19% and the rate further dropped to 15% in April and May.

Having said that daily newly.

Diagnosed.

And Germany are decreasing steadily as of May 22nd about 40% of German has received at least 1 shot vaccine in several regions like Bernie and travel restrictions are partially lifted and we expect to see more travel for the vaccinated and people.

And <unk>.

To compensate for business lost the German government has extended and scope and duration of government subsidies, including Showtime worker compensation and extra government subsidy as those April 2021, DH has received.

$12.7 million Euro short time worker compensation, which is expected to further increase as the lockdowns extend additionally.

Additionally, ph had applied for government subsidy to compensate the loss both in 2000, 2020 and 'twenty 1.

Prolonged lockdown was certainly and coast Pasha from DHS revenue for the impact will be partially offset by the government subsidy at the EBITDA level.

We will only record net income upon the recipients of the formal confirmation on such cash.

We also continue to negotiate for rental deduction compared with $5.4 million Euro waiver achieved in 2020 the year to date waiver of 2021 has amounted to $4.2 million Euro will continue to work on rental and deduction for years and.

Number quoted here are related to cash savings, but the P&L impact actually vary depending on the term of waiver.

In addition, we have also put out and staff on temporary furlough frozen and our head count and reduce discretionary spending and also capex.

And I'll also in discussion with local banks in Germany for additional Corona virus, aged law and banks have been supportive to us.

Turning to page 28 for guidance.

For the second quarter of 2021, we now expect total revenue to grow by 87% to 89% compared to second.

Second quarter of 2020.

Including the H, we expect our revenue to grow by 90% to 92% to.

To provide a more meaningful guidance, we expect total revenue to grow by 27% to 29% compared to the same period of 2019.

<unk> ph and the 2021 revenue and expected to grow by 20% to 22%.

For the full year of 2021, clearly 19th resurgence in January and February slowed down our hotel open plan and the first quarter.

So echoing <unk> point previously we've put more emphasize on quality hotel expansion, we now plan to revise down our non standardized hotel brand opening for the full year.

Considering the above 2 factors will lower our graph opening target of 2021 from 1800 to 2000 hotels to 600 to 800 and hotel.

However, even with this died downward adjustment of growth <unk>, our revenue guidance for <unk> remains unchanged at 50% to 54% growth compared to 2020 or 15% to 19% growth compared to 2019 due to the bad.

For the expected Revpar recovery and the Ltd ton impact of the hotel openings in the later part of the year.

The prolonged lockdown period in Germany has caused for the recovery much slower than previous expected. Therefore, we adjust the full year group revenue growth guidance to be and the range of 44% to 48% compared to find and 20 or 31 percentage.

35% growth compared to 2019 from previous guidance.

<unk> to 54% growth compared to 2020, and 36% to 40% growth compared to 2019.

With that let's open up for Q&A. Thank you.

[noise].

Sorry to ask a question and you will need to press star 1 on your child and town.

And if you are in your question <unk>.

Yeah.

Your first question comes from the OEM.

From Bank of America.

Your line is open.

Yeah.

Hello, Good morning, I have 2 questions and first of all just want to ask about the current trends.

Nicola and me.

And I think from the presentation and you guys mentioned that the robstown already recovered to 107% of the 2.

2019 level.

And just wonder if we exclude the 5 days and <unk>.

Bush holidays.

And we still see positive growth compared to 2019 <unk> for the rest of me and also in particular.

And would like to know a bit more about the trend of the lease and operate a hotel recently.

And then my second question is about like the new opening target.

We understand that and revised downward after new opening targets and there'll be some.

The company pursuing high quality opening and have the highest standard for their new joiner and I'm just have questions off line I think these adjustments has been going for a while.

Do you expect.

The opening page 10.

Salary and again and are also in particular and the new opening target of these.

And 16 to 1800 numbers how.

How many of them.

And so using yourself Brian Maass.

Model and how many will be using our main core brands. Thanks a lot.

All right. Thank you and good morning management.

Hello.

Okay.

Oh, and a whole ton specifically da Vinci.

Teva growth opening horse and credit kind of outside counsel.

Because I assume that each and every channel partners.

Okay.

Yes.

And goods onboard a gene for based on EBITDA and Cushing.

She is Virginia, and the U S you're going to tip to chew.

Tien Tsin you.

Hope for men's and Thats onboard the <unk> zone <unk>.

<unk> and Julien So could you kind of see that's and that's.

And where the gene and wafers for the free zone CUSIP was for that to the Vega Vega <unk> for you because I think that issue.

Okay. So the overall revpar trends and I think we may.

We saw it very satisfactory.

And as we mentioned and the presentation of our amongst 2 day to revpar recovered to over our growth by 7%.

Compared to 2019, even though excluding the 5 days holidays and the beginning of May and the remaining of the day. The Revpar you achieve for positive growth compared to 2019 and behavior points with each year getting doughnuts and into the the Adidas as high as we eat and shop Perugia unclear.

And you all the.

<unk> done for the <unk> Jupiter inkjet for the funding chain for <unk> and so if we go down to the gene the injunction.

Okay, but we still have to be a little bit more cautious that there was due for some of the COVID-19 research has happened and May suggest we probably and assist our nursing young.

Normally from our observations.

Every time, there was a record for resurgence of COVID-19, and where it takes like roughly 2 weeks to recover for the product.

And Kate and good gene and the floor and the boxes with all genes and the local and the countries, but overall for the recovery trend with government and our.

Conservatively optimistic perspective for the overall recovery trend.

The other line, which helps you won't negotiate to go and diarrhea.

And call them into early <unk> junior and ramping either Eli that <unk> pay a toehold igen and yet hygiene, yeah, AUM and Docker junior and the tug.

And the down by jobs, so youll see pets and good what else has them and then the other Sonya lots and Michele Fischer.

And then with visa to hook up and India, and its and et cetera.

For the second question I, just want to mention 1 number to you that for our in line brands actually in 2019, we opened up roughly for over 500, Eli during 2019, but this year. We are just planning to open roughly 200, Eli which mean 300 decline.

And so our overall perspective, and the strategy of SKU concentrating on the quality and hotel expenses and share.

And <unk> Hanmi and women tweaks when that goes online and U haul and she pay for hiking she couldn't do with its ads and Google.

And this is Hal would you open the 2 of them and getting them all of them.

For our lower tier cities penetration. So we actually are going to utilize more of an ehealth brands as they standardize the brands to complement our hunting brands for the lower tier cities penetration.

Okay.

Thank you.

Thanks, a lot and thank you, thanks and seasonal right.

Sure.

Your next question comes from <unk> <unk> from CIBC.

And I think Philippines.

Hi, Thank you management I have 2.

1 question and then.

Nausea, all day.

Hotel opening.

And that always still confidence and sell it.

And target yet.

Oh and the second question and it's all going to go.

And we decided to acquire.

These points and how we finance the exploration and thank you.

Okay.

According to the U S.

<unk> and <unk> and <unk>.

Sure and trading tool.

Its own launch and.

And good chance on time and day charts, and good chooses and size of the food Hall and help us.

Oh and then she does.

Alright.

For <unk>.

Alright, and the EG.

And that's on.

Total U S M and yeah for gradual weaknesses.

And we will build and execute on machine.

For the 10000 hotels in 1000 and cities targets actually we are still progressing to the to achieve these targets.

Currently even though with the COVID-19 impact adjusted using our new signings are gradually being more better compared to last year. Therefore, we are still pretty concrete and together we could achieve a day.

This $10 and hotels and 1000 and cities by the end of 2022 or later in the first quarter 2023. She is a direct vacancies for Julien and say, it's in that sense for the shots and approach and useful to succeed.

Joe This is James Qin <unk> yourself.

And what Antonio Manso Yoshida 3 gene.

And group, which means <unk>.

And the other tool she said put on this is ourself and loading and see this as yet.

Dave.

So that's a walk and gauge assay portal and this is home to a useful tool.

So for our large cities penetrating our penetration and actually we're progressing pretty quickly and now we have signed up over a 1000 hotels and lower tier cities and in addition to that for our upscale or high and Oh.

Hotel market.

Over the last year for.

For after a lot of preparation and turn off the company actually we asked and we are also progressing pretty satisfactory and this area.

<unk> and it's rich.

And bushiness of advances and inching quietest and excuses on yet and channel and tuition that uses <unk> and.

And simple functions on me and so it's on political which uses agency and the types of a BOE a day of <unk> machine for Citigroup. This although assignment dose actually and its value.

The weighted.

Also we are subsidizing the new consumer the younger generation and other lifestyle hotel and supplement that the trend is moving up that's why we are exploring into these segments by leveraging our own brands such as Crystal Orange machine and also the currently acquire the city go back to for the penetrating this.

And as well.

So for those achieved.

And.

Okay.

Just wanted to provide a little bit more color on the city girl.

Entire enterprise value for this acquisition and 750 million RMB and actually imply in terms of the ramp up EBITDA level for the full year perspective.

Valuation multiple EBITDA multiple is actually in the range of 8% to 9 times, which is a pretty fair and attractive valuation considering this brand and unique position and also the prospect of future growth.

And in terms of a cash source is actually and you do notice that we have more than 10 billion RMB cash available, including also the Unutilized bank facilities. So there's no problem.

And also financing for this acquisition.

Thank you.

Your next question comes from Lisa Yang from HSBC.

Okay.

Alright.

Like management and I wanted to ask a question regarding the new and 2021 full year guidance for <unk>, but.

The total revenue growth of us in 2019 remain unchanged and a few other like a 15% to 19% are even though the hotel opened these lower than before so I want to ask what is the current revpar a subject for bottom line, but there's 2019. Thank you.

Okay.

So we are positive about the revpar recovery of the hydro side Ah and Nash.

Our forecast actually we forecast.

Like Q2, it will be like and 97% and the recovery.

And also in Q3 and Q4, it will be 100, and hope for percentage and a 100% recovery compared to 2019 number.

And.

Okay.

Okay.

Yeah.

It's a it's a same hotel level perspective.

Because if you're talking about blended revpar.

It's a it's a little hard.

2.2 compared with 2019 on the same store level. So if you talk about black and it will be for 2.5 percentage increase journey.

General and.

Okay great.

May I clarify on same hotel revpar basis, it's 97% in <unk>, a while ago and Oh, well have better full price and <unk> and 100 per cent for Q right.

Yeah, It's a general guidance.

Yes, certainly we will keep updating this number.

Okay and does this guidance for revenue growth in crude for the country.

<unk> from Citi go acquire yeah, you're right.

It is not.

Okay. Thank you.

Your next question comes from Tien Ho from Th capital. Your line is open.

And.

Yeah, Good morning, and management of a couple of questions why and I look at.

T a C T.

Pension plan for lower tier cities is going to be a majority part of that pipeline.

So, let's say by the end of the year or by the end of next year.

A portion of the Oh and by 2 legacy hotels are going to come from our lower tier city and yet.

Tier 3 and below.

For the tier 3 and below and also tier 1 tier 2 what type of difference between our pool and the brake pad.

Actual occupancy rates.

So that's the number 1 question.

And as you finish all the questions.

And second what and how many hotels and <unk> Berg and he's going to opening in China. This year and also some hotel how many hotels for companies that she.

Okay and get those 2 brands.

And then second and third Watson, which is the last 1 in.

Joseph corporate cash from ours, so I saw the corporate customer.

And they'll contribution increasing so what is the company's also you know like in terms of the corporate customer contribution in the total revenues and that's Matthew question.

Thank you.

And furniture.

Uh huh.

Eagle and Tito Citigroup.

And she said.

And so the on line.

Thank you Sundar.

And I got a hotel English equation.

And I suppose for cement.

For all.

And I wish you a wait and see if we've got enough scale for yes, Algeria and Cambiata seeking beverages.

And they go away or so weighted good.

Good.

Okay.

Okay.

And I share with you heard the other ones.

Women.

<unk>.

Great and good shots and this is an astounding.

And the group Shenzhen Chengdu.

Switching to friendship.

And with channel and say when those loans.

And yes, the short answer is yes.

Further with you, Joe mentioned and machines and the refinancing of violence totals for them and yet.

And so you said you and I, Thank you and shop visits and mills fees Hodgkin's release, and send you 1 channel for that.

And with that and Thats, an issue that puts you somewhere.

And it.

Regardless, shoeboxes and eagerness and Xiaomi, she wants and some who are gone and shingles and soon.

Okay.

So we opened up to the switch and the manner that we license and the Lynch.

Right.

And how you.

And how you give and teachers and Shaw.

And as I have on Apache should consult and I'm a car.

And as you.

As you May you did take Uh huh.

Hum.

And he got a meager ADR.

And she says and price.

Okay.

Okay. Thanks for your REIT, Judy it would be awesome and she did.

Okay.

And guys John said good for <unk>.

You guys said that.

<unk> and digest for a agenda to gene who finds the ports for the US and go quick for.

That is for the year people and the <unk> and <unk>.

Sure and for Ishares and sit there.

And so it will be cheaper.

Attributed to Asia.

Hi.

The call U S chains, and sort of the path and so.

Chris Sanya, and tell us who watch and young modality.

And so do you share holders.

And.

The whole idea of a few quite a JV to.

<unk> grew up and get your answer.

Yeah.

She says and Tom.

And should this out of the.

For the time element, which is your process for that.

So moving to <unk> Oh.

Eugene Wuxi, and Youll talk walk essentially the shovels and day.

And so Watson.

The other 1 seamless for engine.

Okay I went through the transmission for the first question is for the lower tier cities actually being our slide number 5 we provide some of the numbers and can sell for our breakdown in terms of our hotel nutrition and pipelines and argument that we have been putting a lot of airports last year for them.

<unk> actually our pipeline are over 50% of our pipeline come from tier 3 and below cities, which is going to help us to for the enlarged our hotel our hotel from the lower tier cities by the year off this year and also in terms of the revpar grow for us as compared to the lower tier cities and higher tier.

It is actually we have been observing thoughts that the lower tier cities actually have a better revpar revpar recovery compared to the higher tier cities, but I think our I think for after the ramp up period.

Definitely the lower tier cities and would have slightly lower revpar compared to the higher tier cities, but for us our take rate well peanuts and for hotels and no matter. They are indeed higher tier cities for lower tier cities and for the second question in terms of the JV for the upcoming.

Coming years, we have been for the cooperating with the sooner and then the joint venture and and we are going to develop a many are on.

And the stocking and Brooklyn, and the Zone Hotel brand and currently we have over 30 hotels and pipeline.

And some thoughts on growth and good negotiations as Honda joins us as a feedstock transfer with US. So you are going and kind of vocal HUD and halls and prevent to judge it yet.

And no module.

So and with search and order pattern changes and Gotcha I suppose for.

As you May know that the leisure traveler and he is recovering and growing pretty pretty good in China, and we believe and the longer term and steel and a booming therefore for our high end brands, such as stocking program and blew some growth some hills.

<unk> are under the joint venture, we have already a coffee and that's a day.

The future will be.

Why do you need to be there had been a while I think agenda for.

Well and changing tissue you go right and I too.

Alexander and some gundy and.

And with China, Ah, well me and kind.

Uh huh.

And she was income.

And then you'd see the issue.

Thank you.

<unk> net.

Okay.

And with me.

And he told me.

Thanks.

Yeah with a twig.

For the corporates and customers are actually Oh.

It is a very important sources for our for the growth growing our traffic and we are still very optimistic income software.

Corporate customers growth in the future and more importantly, currently the corporate customers contributed roughly 10% of the total room nights, but out of the 10% over 60% of.

The room, that's our thoughts were on lights on line channel, which was a very.

Uh huh.

A very good for us and therefore.

For the future development will still leverage our technology and capability to for the using their <unk> collection to further develop this area.

Yeah, Dan Schuller will and tissue for Glenn to June grocery channel.

Okay got it.

Thank you.

<unk> momentum.

And this woman.

And they might do something.

Yes.

And a chunk or the census engine G CSF ancient Egypt and deal with that actually the assembly I paid.

And profile of EMEA, we attacked and Union Joel dealt with for Guy golf channel or soy audition.

We were only up.

Only focusing on the top 3000 public listed company and from China. We are currently are penetrating into lower tier cities by leveraging our strong direct sales team to do a lot a lot of local sales and we are planning to penetrate.

Every single day provinces in China This year.

Thank you.

[laughter].

Okay.

Okay.

Yeah.

Your next question comes for a melody Chan from Jefferies. Your line is open.

Hi management. Thank you for taking my question.

I have to ask your question.

Kim next question.

Sure.

And that.

Have any other acquisition plan.

In line with our high quality hotel strategy, and how and our view on the market.

Quantitation.

Thank you.

And if so San Diego and you said 1 day you'll notice.

And I think all geopolitical for a woman and Haynesville Tucson equivalent and Cortana to go try and get the.

The whole Oh, sorry, what's your second question, it's himself and the market consolidation.

Yeah.

Hello.

Oh, Hi, Oh, what's our view on the market consolidation.

And I.

And as Nancy.

Abbas.

Thank you.

Okay.

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Thats all losses, our choices are and.

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And to the competitive changes.

Okay and for the first question and term salt for them and they plan and we always keep our eyes open and we always have and to open up.

We have been discussing with many potential partners.

Well there is no clear on target for all our deals are done yet so we will be updating you and honesty or something.

And our confirmed okay and in terms of the market consolidation and the competitive landscape are actually for the economic.

Segment. So we are doing the penetrating and we got better compared to our peers because the lower tier cities has plenty of rooms for penetrating and in terms of the middle skill leveraging on the consumer consumption upgrades and so we will leverage our various brands such as Qi Hotel Orange.

And the newly acquired does it go and our.

Life style brands to further growing our market share in this area and in terms of the high end and upscale segment, we actually competing and waste dosing International hotel groups, we want to use our core competency such as technology and the operational capability to create a diversified competition competition and.

And trying to grab some market share from them. Thank you.

Thank you.

There are no further questions at this time I would like to hand, the conference back to our speakers.

[noise]. Thank you everyone for taking time with us today, and we look forward to a call back with you again in upcoming quarter. Thank you and bye bye.

This concludes today's conference call. Thank you for participating you may now disconnect.