Q4 2024 H World Group Ltd Earnings Call
Jun Zou, Ronald Leung, Hui Jin
Speaker Change: Good day and thank you for standing by. Welcome to the H12Q4 full year 2024 earnings conference call.
Speaker Change: At this time, all participants are in a listen-only mode. You all need to press star 1 and 1 on your telephone. You will then hear an automated message advising your hand is raised. To enjoy your question, please press star 1 and 1 again. Please be advised today's conference is being recorded. I'd like to hand the conference over to your first speaker today, Jason Chen, Head of IR. Please go ahead.
Jason Chen: Thank you, Sarah. Good morning and good evening, everyone. Thanks for joining us today. Welcome to Edgewood Group, 2024, fourth quarter and a full year earnings conference call.
Jason Chen: Joining us today is our founder and chairman, Mr. Chi Chi.
Speaker Change: Our CEO, Mr. Jin Hui, our CFO, Ms. Chen Hui, and our CSO, Ms. He Jihong.
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Speaker Change: Although there were some SKU macro uncertainties in the trial and just interest on 24, the overall domestic travel demand continued achieving steady growth.
Speaker Change: I suggested by some industry data and our operational results.
Speaker Change: For example, the number of passengers transported by railway increased 11, 9% year over year in 2024, and a domestic air passenger traffic rose by eight 8% during the same period.
Speaker Change: Sure travel continued its strong growth momentum and outperformance of business travel.
Speaker Change: According to the data from the Ministry of culture, and tourism the number of domestic truck Torres Rich five 6 billion up 14, 8% year over year, we used the total domestic tourism spending up 17, 1% year over year teaching RMB five eight trillion. This reflects the people strong routing.
Speaker Change: All traveling as well as strong support from local governments to promote tourism activities.
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Looking into the hotel industry in China, specifically.
Speaker Change: Daddy gross anything bad, particularly the faster growth in leisure demand has lacked to supply increasing some regions and areas, which resulted a temporary supply demand imbalances and has brought some pressures on the ADR. However.
Speaker Change: Ever in the long run we believe that the hotel industry is a highly market oriented and a fully competitive industry and the supply and demand dynamic. We're gradually returned to a more balanced and originally about level after a certain period of time.
Speaker Change: As the market leader, we will continue pursuing our high quality development strategy.
Speaker Change: Leveraging either products and the services and stronger brands positioning and efficient operations at all.
Speaker Change: Our core competitive edges to attract more customers and to build up stronger capability to navigate through all cycles now let me walk you through our 2024 key achievements and operational highlights so as yet.
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Speaker Change: First off all in May 2020 for legacy <unk> achieved a key milestone of 10000 hotels skiing went out of the cities and counties and.
Speaker Change: In hunting and hotel opened in Baltimore County, you bet.
Speaker Change: Where is the lost account teach again highway access in China.
Speaker Change: Secondly, the group opened a record high of 2040 2442, new hotels during 2024 of which 2430, what new openings, what's contributed from legacy module.
Speaker Change: And it was supported by our acceleration of lower tier cities penetration to better capture more growth and development opportunity in China market.
Speaker Change: Italy, we are happy to see our upper mid Sackman continued gaining momentum with hotel, that's what grow by 35% year over year in 2024 outpacing last year.
Speaker Change: Thanks to the strong development of intra city, and a crystal Orange Brent <unk>.
Speaker Change: Lastly, we continue to pursue in our asset light model strategy in 2020 for the asset light revenue contribution exceeded 50% full board Nicolas business.
Speaker Change: At the same time.
Speaker Change: That's a lie transformation also achieved some breakthroughs, which we will elaborate later.
Speaker Change: We believe that the asset light model will help us to achieve more stable and sustainable development in the long run and generating stronger and healthier cash flow.
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Speaker Change: Please turn to the next page.
Speaker Change: Over the past decade.
Speaker Change: Populus network expansion achieved a CAGR of 18, 6% growing from less than 2000 hotels in 2014 to our current level.
Speaker Change: And our expansion, what's getting you might factor in the past two years with over 2000, new gross new hotels open interest on 24.
Speaker Change: It helped us further solidifying our leading position in the industry.
Tucson, and twenty-five marks the 20th anniversary of Etch what group.
Speaker Change: Over the past 20 years, we have evolved our step by step from a single Hudson branded hotel to the parents are multi brand hotel management group with over 11000 hotels in operation.
Moreover, we are also a corresponding from an asset heavy business model.
Speaker Change: Life X pricing model with focus more on product and service quality as well as brand positioning and the management capability.
Speaker Change: Going forward, what we will stick to our high quality expansion strategy and aim to reach our next goal of 2000 cities with 20000 hotels in the near future.
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Speaker Change: Now, let's review our legacy if at.
Speaker Change: Operational performance in 2024, please turn to page five in 2020 full laxey watchlist blended revpar decreased slightly by 3% to RMB 235.
Speaker Change: In 2024 hour occupancy rate improved by 0.2 percentage points year over year to 81, 2%. Despite that our room count grew by 20% year over year in 2024, and a lot of newly opened hotels were still in their ramp up periods.
Speaker Change: This further demonstrating our strong capability to attract and serve more customers and to grab more market shares.
Speaker Change: However, ADR, what's downstream pointing to 2% to RMB 289, mainly due to a high base last year as well as supply increase.
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Speaker Change: Turning to page six in Tucson in 'twenty four we achieved a record high hotel expression of 2000 and 430, new openings at the same time the number of hotel closures in 2024.
Speaker Change: 606, 668 lower than that in 2023. This was mainly due to fewer closures of eland and hunting 1.0.
Speaker Change: Moving forward, we will still prototypes quality over quantity in terms of expansion and continuously faced out unqualified hotels from our portfolio and the pipeline to ensure a constant product and service quality improvements.
Speaker Change: By the end of 2024, we have a total of 2988 hotels in the pipeline increased by 89 hotels sequentially.
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Speaker Change: We continue focusing on the economy and mid scale segment for mass market penetration and the development.
Speaker Change: Turning to page seven by the end of 2020 for legacy <unk> economy, and the Middle scale hotel accounted for 91%, 79% and 89% after hotels in operation the hotel pipeline and the new openings retroactively weed.
Speaker Change: We believe the mass market remains the largest and the most promising market in China.
Speaker Change: And it is also the foundation of our business going forward, what about cost density roll out high quality and good value for money limited service hotels expand our coverage national Lloyds and solidify our leading position in the limited service segment.
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Speaker Change: Continuous product upgrades is one of the key factors to maintain market, leading position and enhance competitive patch for achieving long term sustainable growth in 2024, we launched new versions on the Street brands, which included 2.0, Hi, E 6.0, and the Crystal Orange 2.5.
Speaker Change: And hyenas serves as kind of teens supplementary brands to profuse accommodation demanded for younger generation and to support lower tier cities penetration and to help strengthening our presence in the leading position in the mass market, while crystal Orange two five was designed for the business travelers in higher tier.
Speaker Change: Cities and that together with intra city to be our key brands to further breakthrough and a catch up in the upper mid segment in China.
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Speaker Change: We continued to improve product quality upgrades for our Golden triangle for brands.
Speaker Change: Service sacraments over the last several years, please turn to page eight hunting three five and above version has been increasing every year by the end of 2020 for the proportion of kind of tier three five and above expanded 15, 15 percentage points year over year and accounted for over 36.
Speaker Change: Percent of kind of three hotels in operation.
Speaker Change: Please turn to page nine among all <unk> hotels in operation the proportion of <unk> 4.0 version and above.
Speaker Change: Up from 30% in 2020 to 70, 76% in 2024, then please turn to page 10, the propulsion of Orange 2.0, and above expanded from 14% in 2021% to 66% in 2024.
Speaker Change: Through a consistent product upgrades, the brand and that brand power for our Golden triangle brands, what see continuous enhancement and a solid vacation.
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Speaker Change: In terms of regional expansion our penetration in the lower tier cities continued progressing please turn to page 12.
Speaker Change: That's the end of 2020 for around 42% of the company's hotels in operation were located in tier three and below cities, reflecting a two percentage points year over year increase.
Speaker Change: The propulsion of pipeline hotels in these market reached 54%.
Speaker Change: 12 percentage points higher than operating hotel ratio.
Speaker Change: Additionally, by the end of 2024 hour cities and the countries coverage expanded to 1380 added 123, new cities in Colombia, as compared to a year ago.
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Speaker Change: Our ultimate Sackman continued gaining strong growth momentum please turn to page 13.
Speaker Change: That's the end of 2024, the number of hotels in operation and hotels in pipelines in the upper mid segment, both increased by 35% year over year.
Speaker Change: 873, and 521 hotels, respectively.
Speaker Change: After few yourself development, our core brands in the Sacramento scan pattern recognition among customers and franchisees, which helped us to expand network faster than before.
Speaker Change: We will continuously put more efforts on developing in this segment and strive to become one of the top brand in the near future.
Speaker Change: Definitely not the fiscal year.
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Speaker Change: Please turn to page 14 in Tucson in 'twenty for the rapid development of our corporate business effectively offset that some impacts around the shortage of individual business travel demand and helped us to achieve a stable occupancy rates for.
Speaker Change: For the full year direct corporate bookings exceeded $27 6 million room nights sold reflecting a 39% year over year increase.
Speaker Change: With active corporate accounts surpassed.
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Speaker Change: By 49% year over year.
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Speaker Change: We always emphasize that the membership program and direct sales capability or the most of the critical aspects for our business to achieve long term sustainable development in the gross please turn to page 15, as the end of 2024 hour Mem member base further increase that youre nearly $270 million.
Speaker Change: During the fourth quarter of 2024 room nights generated through the Central reservation system accounted for 66 66, 4% of the total bookings representing an increase by four one percentage points year over year and a two two percentage points sequentially.
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Speaker Change: After reviewing our performance in the year of 2024, that's now looking to our key focus in 2025. Please turn to page 16 inches and 25, we will continue focusing on high quality gross well further penetrating into lower tier cities as well as those white spaces for our <unk>.
Speaker Change: Limited service segment.
Speaker Change: In addition, we will continuously enhance our development and the process for the upper mid brand in the select service segment.
Speaker Change: Sometimes what we'll focus more on brand building and brand positioning as well as continue implementing our service excellence strategy with our customer centric pricing falls.
Speaker Change: On the product front, we will further improve product quality and launch new products to strengthen our brand and our product consistency to improve customer satisfaction.
Speaker Change: Meanwhile, we will motivate and authorized our staff and employees to encourage them to proactively provide the proper service to the customers.
Speaker Change: By doing so we can ultimately achieve a low cost high efficiency and outstanding service level with strong ex what characteristics.
Speaker Change: Certainly we will continue to pursue our asset life strategy to achieve a more stable and sustainable longer term development.
Speaker Change: Lastly in terms of our sales and marketing our etch rewards membership program is undoubtedly the core focus we are aiming to improve member engagement level and improve user retention and a repurchase.
Speaker Change: Additionally, we will also further optimized our sales capabilities to better serve and attract more diverse customer base and the virus consumption scenarios.
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Speaker Change: All are both concludes the 2024 operational updates for lexical module now I will hand over the quarter, our CSO of its critical to give an update on the legacy D edge. Thank you.
Speaker Change: Thank you Julie.
Speaker Change: I will highlight the chief of Fleming's legacy DH business now.
Speaker Change: Please turn to page 17.
Speaker Change: So our legacy DH business, we're happy to report that in the first quarter of 2020 for Revpar improved over 10% to 80, why you're out compared to last year.
Speaker Change: This improvement is mainly driven by seven percentage points of occupancy.
Speaker Change: For the full year 2020 for Revpar increased five 9% to 76 zero compared to 2023.
Speaker Change: This is country busy at one 5% increase in ADR and two seven percentage point increase in occupancy.
Speaker Change: Please turn to page 18.
Speaker Change: In the second half of 2024, we carried out a series of cost cutting and restructuring activities.
Speaker Change: What do they do use a domain staff at headquarters that 30%.
Speaker Change: We restructured our operations management team to improved hotel performance.
Speaker Change: At the same time, we accelerated it to put a photo of a restructuring to become more asset light.
Speaker Change: In 2020 sport, we exited 14 lease attached.
Speaker Change: Or are these assets starting to pay off although full year benefits will only be realized in 2025.
Speaker Change: In 2024 hour revenue increased nine 6% to RMB four 9 billion.
Speaker Change: More importantly, our core adjusted EBITDA, which exclude restructuring costs.
Speaker Change: <unk> value in a goodwill impairment and other adjustments of one time nature in it.
Speaker Change: Creased by 64% <unk> $356 million.
Speaker Change: Please turn to page 19.
Speaker Change: Looking forward, we will continue our effort to improve that the C D H business.
Speaker Change: We will focus on three key areas.
Speaker Change: First of all optimization of hotel operations show a disciplined approach.
Speaker Change: Enhancement and cost management in each of our hotels.
Speaker Change: Secondly, we'll start to see positive impact of overhead reduction from 2024.
Speaker Change: At the same time.
Speaker Change: <unk> stopped all overhead streamlining assay.
Speaker Change: Continuous scrutinizing the admin costs.
Speaker Change: Sure will.
Speaker Change: We'll continue to pursue asset life strategy and exited unprofitable at leases.
Speaker Change: As a matter of fact, we exited another 11 contracts in February 2025.
Speaker Change: With all of these assets, we strive to improve the profitability of the H b.
Speaker Change: In 2025 due to exit the lease hotels and a change of these lease so franchise contracts our top line revenue will decrease at first glance.
This portfolio reshuffling assets will improve our sustainable profitability as we transform the leases to fee base a franchise business.
Speaker Change: Yeah.
Speaker Change: This concludes that the <unk> deal and now handing over to CFO Ms <unk> Li for financial review.
Speaker Change: Yes.
Speaker Change: Thank you.
Speaker Change: What do you Renee and good morning, everyone.
Speaker Change: We walk you through our operational and financial results for the fourth quarter and full year of $10 94.
Speaker Change: Please turn to page 21.
Speaker Change: Our hotel network.
Speaker Change: In order to expand the overall number.
Speaker Change: Increase of 19%.
Speaker Change: Okay.
Speaker Change: Sure.
Speaker Change: Compared with 900 staff.
Speaker Change: So we're almost a year ago.
Speaker Change: <unk> for the full year opportunities and therefore, what's the RMB 93 bidding.
Speaker Change: Our 15.
Speaker Change: Year over year increase what does 2023.
Speaker Change: Alright segments.
Speaker Change: Let's see if I can the totality of over 16% year over year to 85.
Speaker Change: And the next DH <unk> increased 9% year over year to a bidding Andy.
Speaker Change: Please turn to page 22.
Speaker Change: Our revenue.
Speaker Change: In the first quarter of $10 24.
Speaker Change: Total revenue for that little increase this semi ate.
Speaker Change: <unk> yeah yeah.
Speaker Change: Two 6 billion RMB.
Speaker Change: Exceeding the high end of our guidance.
Speaker Change: For the for 10 days and therefore total revenue affordable increased nine 2% year over year to <unk> three 9 billion.
Speaker Change: By segment.
Speaker Change: Revenue from Nexium quadrupled.
Speaker Change: <unk> nine prime to extend yeah, well yeah.
Speaker Change: A follow up on a bidding R&D in the fourth quarter.
Speaker Change: Between the high end of our guidance.
Speaker Change: Thanks to the better than expected hotel openings.
Speaker Change: And then apart from that.
Speaker Change: And its full year revenue grew nine 1% year over year to 19 bidding.
Speaker Change: In 10 days, and therefore quite Florida crossed 63 lease and owned hotels.
Speaker Change: We pursue a more asset light model.
Speaker Change: I started out Mexico Atlas revenue from these on hotels decreased <unk>.
Speaker Change: 8%, Yeah, well, yeah in Q4, and a decreased three nine.
Speaker Change: 9% year over year for the full year.
Speaker Change: On the other hand, it's monetized and franchise revenue a party that much stronger growth of 24%, yeah, well, yeah in Q4, and 23, 6% year over year for the full year.
Speaker Change: Mainly attribute that's you.
Speaker Change: Beautiful two our strong new hotel openings.
Speaker Change: A slight glide path.
Speaker Change: For legacy <unk>.
Speaker Change: Revenue rose two 9% year over year to a one time two bidding on R&D in the fourth quarter.
Speaker Change: Was up nine pilots.
Speaker Change: Yeah, well, yeah tool for client nine bidding.
Speaker Change: For the full year.
Speaker Change: Driven by Revpar growth.
Speaker Change: Turn to page 23.
Speaker Change: As we have been continuously implementing our asset light strategy.
Speaker Change: <unk> contribution from our <unk> franchise hotels.
Speaker Change: And last one.
Speaker Change: For year 2024.
Speaker Change: Revenue contribution from monetized them franchise hotels.
Speaker Change: 40% for the broker.
Speaker Change: From 35% yet though.
Speaker Change: For next year too.
Speaker Change: Revenue contribution from <unk> and franchised hotel visit at 49%.
Speaker Change: Pat at 243% and yet though.
Speaker Change: And that revenue contribution from these on the business for the first time a unit basis.
Speaker Change: We expect this trend to continue and we believe our asked the last strategy.
Speaker Change: That's part a gradual and continuous margin expansion after.
Speaker Change: For the company and are generating strong cash flow.
Speaker Change: That's the way I have had.
Speaker Change: To become more of a student when navigating us through all economic cycles.
Speaker Change: Yeah.
Speaker Change: Now moving to a die casting expansion.
Speaker Change: That section.
Speaker Change: Please turn to page 10 defaults.
Speaker Change: Hotel operating costs affordable.
For full time to abating RMB in the fourth quarter and the 15 Prime three bidding R&D for the full year.
Speaker Change: Four 9% year over year.
Thailand was 6% year over year perspective.
Speaker Change: Hotel operating costs of lexical actual decreased.
Speaker Change: Five prime 3% year over year in Q4.
Speaker Change: Increased three 8% year over year for the full year.
Speaker Change: Slower than the revenue growth in.
Speaker Change: We ended up seeing that corresponding period.
Speaker Change: That's two of the transformation to a more asset light portfolio.
Speaker Change: Next digital hotel operating costs amounted to.
Speaker Change: One four beating RMB in Q4.
Speaker Change: And the four times three beating RMB in 2024.
Speaker Change: Representing 33% and 14, 4% increase respectively.
Speaker Change: Primarily due to roughly.
Speaker Change: 420 meeting RMB impairment loss.
Speaker Change: In Q4.
Speaker Change: SG&A expense for the group.
Speaker Change: Well, one bidding RMB in the fourth quarter and $3 7 billion RMB for the full year.
Speaker Change: At 5.3.
Speaker Change: <unk>, 3% year over year at 13, 7% year over year, respectively.
Speaker Change: Nexium will address SG&A inquiries.
Speaker Change: 13, 4% year over year in Q4, and a 19.7% year over year in 2024, mainly.
Speaker Change: Mainly due to a highly higher share based compensation.
Speaker Change: Attract another 10 caught in.
Speaker Change: Who are key to our sustainable long term business growth.
Speaker Change: If excluding share based compensation next ill address SG&A expense would have increased.
Speaker Change: April one.
Speaker Change: 8% year over year in Q4 and five.
Speaker Change: 5% for the full year.
Next the DH SG&A decreased 14, 4% a year over year in the fourth quarter.
Speaker Change: Next to our restructuring and cost optimization effort.
Speaker Change: Do you just for your SG&A increased nine 4% year over year.
Speaker Change: Our income from operations.
Speaker Change: A 19, 2% year over year to 900 to a meeting.
Speaker Change: 902 meeting RMB in the fourth quarter and increased 10, 3%, yeah well yeah.
Speaker Change: So five five time to bidding and be for the full year by.
Speaker Change: Segment, that's required with the party of the App.
Speaker Change: What do you see them on price by 7%, Yeah, well, yeah operating income growth in Q4, and 14, 4% year over year growth for the full year 2024.
Speaker Change: Next of DH upgrading.
Speaker Change: But even loss widened.
Speaker Change: Due primarily to the impairment loss.
Speaker Change: Mentioned that previously.
Speaker Change: And Iraq.
100, emitting RMB, one off a one off restructuring costs, but for the full year.
Speaker Change: Please turn to page 25 for the for our profitability and our cash flow.
Speaker Change: Our growth in adjusted EBITDA.
Speaker Change: At 10, 3% year over year.
Speaker Change: One time to bidding RMB in the fourth quarter and the increased <unk>.
Speaker Change: 8% flat year over year to two 6.8 bidding RMB for the full year.
Speaker Change: To better reflect our core operational performance.
Speaker Change: Further made at adjustments are noncash impairment loss of DH extraction of cards and the pervious, yes, probably that relate to that comment of subsidies.
Speaker Change: <unk> told adoptions.
Speaker Change: Which are now operational.
Speaker Change: One off items.
Speaker Change: Uh Huh and adjusted EBITDA increased.
Speaker Change: 15 <unk> five.
And year over year to $1 7 billion RMB in the fourth quarter and April.
Speaker Change: 13.9, then yeah, well yeah to seven point.
Speaker Change: <unk> <unk> for the full year.
Speaker Change: By segment.
Speaker Change: Lexical address acquired adjusted EBITDA increased 14, 5% year over year to one five bidding RMB in Q4 and are prone to alpine 5%, yeah, well yeah.
Speaker Change: Seven one bidding them before the full year.
Speaker Change: Given by our high quality high quality of network expansion and our asset light strategy.
Speaker Change: Can you just acquired adjusted EBITDA increased 24%, yeah, well, yeah in the fourth quarter and 54 point.
Speaker Change: 1%, yeah, well yet for.
Speaker Change: For the full year since two that ran up hospitals.
Speaker Change: Our cost optimization.
Speaker Change: Optimization effort.
Speaker Change: Sure.
Speaker Change: Adjusted net income more.
Speaker Change: 321 meeting RMB in the fourth quarter.
Speaker Change: It was so rapid primarily by a surge in withholding tax.
Speaker Change: It was mainly related to our dividend distribution.
For the full year 2024 hour growth.
Speaker Change: And adjusted net income increased 5.8%, yeah, well, yeah, two or 3.7, beating them be.
Speaker Change: Which <unk> had adjusted net income Roe.
Speaker Change: And I'm trying to understand year over year.
Speaker Change: So for a full plan to bidding RMB.
Speaker Change: In Kenya, and therefore, the probe and the bridge of the operational cash flow cash inflow.
Speaker Change: Seven 5 billion RMB.
Speaker Change: Please turn to page 26 for our liquidity position.
Speaker Change: That's off and Sandy 24 separate overhead.
Speaker Change: I'm fine.
Speaker Change: I am bidding RMB cash.
Speaker Change: Cash equivalents with Georgia, cash and time deposits tobacco.
Speaker Change: And it was being started net cash position.
Speaker Change: So it's probably around 5 billion RMB.
Speaker Change: Including time to project.
Speaker Change: Please go ahead.
Speaker Change: <unk> three bidding RMB.
Speaker Change:
Speaker Change: And utilized bank facilities as of end 2024.
Speaker Change: Now moving to our shareholder return.
Speaker Change: Please turn to page 27.
Speaker Change: We started to pay dividends to shareholders since 2017.
Speaker Change: Except for <unk>.
Speaker Change: <unk> and attendee tended to what's you are heavily impacted by Covid.
Speaker Change: In 2024.
Speaker Change: We revised it.
Speaker Change: Our dividend payout policy from up to 45% to a no less than 60% of net profit.
Speaker Change: Together with our announcement of up to two bidding.
S dollar three yeah shareholder campaign.
Speaker Change: Today.
Speaker Change: We are glad to announce that the.
Speaker Change: The board has approved with a 300 million U S. Dollar our final cash dividend for the second half of 2024.
Speaker Change: I said without that total shareholder return for our 'twenty to 'twenty four.
Speaker Change: Richard This is up to 717 meeting U S. Doris.
Speaker Change: What's in crude.
Speaker Change: 500 million cash dividend.
Speaker Change: Three and a 270 meeting share buyback.
Speaker Change: This accounted for more than one third of our three year plan three year plan and over 80% of free cash flow generated in the year.
Speaker Change: So we are going to a more asset light and expecting stronger in that test.
Speaker Change: Tests are happier healthier cash flow in the future, we will be highly committed to our current shareholder.
Speaker Change: Pat.
Speaker Change: And our costs are consistently pay dividend to our shareholders.
Speaker Change: That's a page 28 on guidance.
Speaker Change: For the first quarter of 'twenty or 'twenty, five we spread our envelope revenue to grow zero to 4% compared to Q4 to Q.
Speaker Change: Q1, 'twenty 'twenty four.
Speaker Change: And it's 3% to 7% is extraordinary D S.
Speaker Change: As you May recall, we initial age of the asset light transformation of the edge in early 2024 in the beginning of this year. We have successfully completed 11, DH hotels transformation from lease lease model to a franchise model.
Speaker Change: If excluding the impact of this asset light transformation on a comparable basis.
Speaker Change: Corporate revenue growth, 3% to 7%, yeah, well, yeah in Q1 2025.
Speaker Change: For the 48 hour to near 25, we expect our revenue to grow 2% to 6% year over year.
Speaker Change: The 5% to 9% if excluding D S.
Speaker Change: If excluding.
Speaker Change: The impact of U S ally transformation com.
Speaker Change: Comparable basis.
Speaker Change: Revenue rose, 4% to 8% year over year in 2025.
Speaker Change: As you may notice.
Speaker Change: In addition to that to the total revenue guidance.
Speaker Change: We are now providing a revenue guidance for the monetize and franchise business.
Speaker Change: And so we are pursuing a more asset light model.
Speaker Change: We believe the monetize and franchise business.
Speaker Change: Better this wraps the company's growth.
Speaker Change: Yes.
Trajectory in the long run.
Speaker Change: We expect our monetized in franchise revenue.
Speaker Change: Grow 18% to 22% compared to Q1 2024.
Speaker Change: And for the full year 2025.
Speaker Change: We expect our monetize our franchise revenue took what almost 17% to attendee at 1% year over year.
Speaker Change: In terms of unit growth.
Speaker Change: We are expecting to open Myron Susana 300 hotels into new 25 <unk>.
Speaker Change: <unk> advanced Pangea hotels for the same here.
Speaker Change: It should represent roughly 15% year over year.
Speaker Change: Net or gross.
Speaker Change: With that we're ready to take your questions.
Speaker Change: <unk>. Please open the line for Q&A.
Speaker Change: Thank you to ask a question you will need to press star one and one on your telephone and wait for your name to be announced and to withdraw. Your question. Please press star one on one again.
Speaker Change: Thank you.
Speaker Change: First question is from the line of Ronald Leung from Bank of America. Please go ahead.
Speaker Change: Hey, good why Watson.
Speaker Change: How are we all going well.
Speaker Change: <unk> he says.
Speaker Change: <unk>.
Speaker Change: Cleveland, So you'd see two Hyatt Deutsche had net take a rough pilot <unk>.
Speaker Change: Uh huh.
Speaker Change: Legal and Pete.
Speaker Change: But one thing is like one <unk> Dx.
Speaker Change: <unk> seen that.
Speaker Change: So what how would you end up okay. So.
Speaker Change: So I think that was it.
Speaker Change: So it <unk> take a ton of Laredo may also.
Speaker Change: Okay.
Speaker Change: Well the NIM guide you how does it go in if I'm in Eagle Ford. So let me try to say my questions into English I have two questions. My first question is about a rough patch how long.
Speaker Change: May I ask what is your outlook for <unk> and also for full year revpar growth that.
Speaker Change: That's the first question. The second question is about the edge so for.
Speaker Change: DHL is would there be any strategy change ahead, and how should we think about the earnings recovery going forward. Thank you very much.
Speaker Change: Oh, I shouldn't with ideal until when you wrap either to the Chooser.
Speaker Change: And that's when we do the Shanghai Con Tango T J, the Pudong Ichi Dean Trudeau a somewhat.
Speaker Change: Jim.
Speaker Change: A woman kind on the New York shows your answers on the <unk> zone.
Speaker Change: Candidly she would say it's almost hard to define time, that's an issue for me.
Speaker Change: According to the swing was almost honestly on the the way that turns on the cheap.
Speaker Change: So thank you to your portal a woman EG too so the San Diego TJ, but don't do achieves a 10 year hold the two the same as something to put them lean shop easy to clean up with switching equally suite.
John: Yeah sure John Thanks, Sue them into each union zoom for jewelry and a real part you didn't see good Joey when do you see the E U.
John: That woman she that owning our own you're in tune with the rope heartening parts Sudan S Cheapened Wendy.
John: We'll do it in that neighborhood.
John: Excuse me.
Speaker Change: So let me answer your first question is regarding to the rough path I'm, assuming the Osage Scott in the first quarter. There are some off the seasonality as well as to you know a different performance among different regions and areas.
John: But we clearly see the demand from the leisure traveler.
Speaker Change: <unk> very strong.
Speaker Change: However for the business.
Speaker Change: <unk> trends.
Speaker Change: Trends of the recovery from the bottom and we also saw some of the you know start party research stuck there have the expectation that the business traveler demand may start recovering this year, but however in the first quarter given the seasonality given the you know.
Speaker Change: Underperformance or a bit weak performance in the first half of March.
Speaker Change: Now it's back to the first quarter revpar to be a bit low single digit decline on a year over year basis. However, looking into a full year basis, we are still quite confident that the revpar for the full year are going to be stabilized compared to 2024 or even a little bit increase.
Speaker Change: <unk>.
Speaker Change: This is <unk> I will take the question about the edge.
Speaker Change: So in 2024 as I explained in the presentation and we started to clients.
Speaker Change: Heavy handed restructuring and the oldest aspect what starts to pay off on full year basis in tiny tiny tiny so in.
Speaker Change: Plenty plenty finds our main strategy is to.
Speaker Change: To still stopped the bleeding and to stabilize the.
Speaker Change: Our business in this format.
Speaker Change: And it was that turned around.
Speaker Change: Accomplished.
Speaker Change: Also.
Speaker Change: If you look at Willis and look for growth opportunities.
Speaker Change: At the same time as well.
Speaker Change: Through our asset light and organic gross after the th correctly.
Speaker Change: So if you look at the.
Speaker Change: The net income.
Speaker Change: For 2024 actually that's why we.
Speaker Change: Focus and also stretched it a core EBITDA improvement and that is really the results of our turnaround efforts and put us on a restructuring and that's kind of a trend.
Speaker Change: Can you can expect that to continue.
Speaker Change: This time at this time, we do have an impairment.
Speaker Change: And also restructuring costs recorded for 2020 for especially in the last quarter.
Speaker Change: The impairment is the result of <unk>.
Speaker Change: Branch value and well as well from.
Speaker Change: From the purchase under this kind of impediment.
Speaker Change: We evaluate every year based on our gross cecere and growth plan.
Speaker Change: And next year, we will continue to observe the market, but we do not.
Speaker Change: <unk> expect.
Speaker Change: Do you expect this kind of had impairment.
Speaker Change: Immediately.
Speaker Change: And the restructuring asset we will continue on a case by case.
Speaker Change: In some cases because of the overhead and because it means that we will probably still have to do some restructuring and the property will be caught some of some restructuring costs, but you would not be in the same magnitude as changed at this point.
Speaker Change: Thank you very much.
Speaker Change: Yeah.
Speaker Change: Thank you.
Speaker Change: We'll now take our next question.
Speaker Change: This is from Dan <unk> from Morgan Stanley. Please go ahead.
Speaker Change: Great.
Speaker Change: Ah Okay, what's it going to see when the two way would you be able to when tissue.
Speaker Change: We don't believe that you should cut off so we don't see an aggressive ecosystem.
Speaker Change: <unk> do you think by Emailing gig, we don't naturally bed.
Speaker Change: Kind of what he does shift to a tissue that you think tow golar LNG by the channel take up high CBD.
Speaker Change: So when you start to see a kind of a consumable just wait it's I call. It early and there's a whole jewel.
Speaker Change: How the week or the takeaway out to well monetize shot on goal with the adult Andy subsidies.
Speaker Change: You sure sounds out of Dubai ICD the Cody.
Speaker Change: Please allow me to translate my question into English for FY 'twenty 34, total shareholder return was.
Speaker Change: Close to 800 million U S dollar amount, which 500 million dividend exceeded a 100% payout ratio. So going forward. If there is no good buyback opportunity should we expect even.
Speaker Change: <unk> hired a dividend payout to match the total shareholder return levels seen in 2024. Thank you.
Speaker Change: Good day.
Speaker Change: Are they asking me I want my Shanghai that won't kill you might see in the changing from Palm Beach, sometimes shockwave junking audiencia, making that will be out there.
Speaker Change: Without the AUM across the chimps without my Johnny if that ever changing tier one dina changing meal, when a woman John tissue fishing <unk> actually maintained upward don't worry about July.
Speaker Change: Hope you all we can build upon a foundation for last week, we opened up with them.
Speaker Change: Okay, Let me, let me very healthy traffic.
Speaker Change: So in 2024th we returned a total of around $770 million to our shareholders.
Speaker Change: Which are $500 million through cash dividend and the 270 mid <unk> through the share buyback. This is thanks to our asset light model on transformation, which help us to generate as much stronger and healthier cash flow and looking forwards. So we will stick to our current shareholder return plan, which which is a three years plan.
Speaker Change: To return.
Speaker Change: Up to $2 billion U S dollars.
Speaker Change: So so and.
Speaker Change: Mainly through the cash dividend. So that's the current plan for for now thank you.
Speaker Change: Thank you.
Speaker Change: Thank you.
Speaker Change: I would now like to hand, the conference back to management for any closing remarks.
Speaker Change: Thank you everyone for taking your time with US today, and we look forward to see you in upcoming quarter. Thank you and bye bye.
Speaker Change: Thank you. This concludes today's conference call. Thank you for participating and you may now disconnect.
Speaker Change: Okay.
Speaker Change: [music] okay.