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China Lodging Group, Limited Reports Fourth Quarter And Full Year 2012 Financial Results

  • Net Revenues increased 35.7% year-over-year for the fourth quarter and 43.3% for the full year of 2012, exceeding the high end of previously announced guidance.
  • Adjusted EBITDA from operating hotels (non-GAAP) 1 increased 23.8% for the fourth quarter and 43.6% for the full year of 2012.
  • Net income attributable to China Lodging Group, Limited was RMB18.2 million (US$2.9 million) 2 for the fourth quarter and RMB174.9 million (US$28.1 million) for the full year of 2012. Diluted net earnings per ADS 3 for the year were RMB2.83 (US$0.45); adjusted diluted net earnings per ADS (non-GAAP) for the year were RMB3.17 (US$0.51), representing a growth of 49.5% from prior year.
  • A total of 1,035 hotels or 113,650 hotel rooms in operation as of December 31, 2012
  • The Company provided guidance for full year 2013 net revenues growth of 26% to 29% and Q1 net revenue growth of 30% to 32 %.

SHANGHAI, China, March 6, 2013 (GLOBE NEWSWIRE) -- China Lodging Group, Limited (Nasdaq:HTHT) ("China Lodging Group" or the "Company"), a leading and fast-growing multi-brand hotel group in China, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2012.

Fourth Quarter 2012 Operational Highlights

  • During the fourth quarter of 2012, the Company opened 50 leased ("leased-and- operated") hotels and 70 net manachised ("franchised-and-managed") hotels.
  • The occupancy rate for all hotels in operation (excluding franchised Starway hotels) was 92% in the fourth quarter of 2012, compared with 93% in the fourth quarter of 2011 and 97% in the previous quarter. The slight year-over-year decrease was mainly because our fast expansion led to a higher percentage of manachised hotels at the ramping-up stage during the fourth quarter of 2012, compared to a year ago. The sequential decrease resulted mainly from seasonality.
  • The ADR, which is defined as the average daily rate for all hotels in operation (excluding franchised Starway hotels), was RMB176 in the fourth quarter of 2012, compared with RMB179 in the fourth quarter of 2011 and RMB183 in the previous quarter. The year-over-year decrease was mainly attributable to the city mix shifting toward lower-tier cities, partially offset by an increase in same-hotel ADR. The sequential decrease resulted mainly from seasonality.
  • RevPAR, defined as revenue per available room for all hotels in operation (excluding franchised Starway hotels), was RMB162 in the fourth quarter of 2012, compared with RMB167 in the fourth quarter of 2011 and RMB178 in the previous quarter.  RevPAR for leased hotels was RMB167 in the fourth quarter of 2012, compared with RMB170 in the fourth quarter of 2011, and RMB183 in the previous quarter. 
  • For all hotels which had been in operation for at least 18 months (excluding franchised Starway hotels), the same-hotel RevPAR was RMB179 for the fourth quarter of 2012, a 2% increase from RMB175 for the fourth quarter of 2011, with a 1% increase in ADR and a one percentage-point increase in occupancy rate.

Full Year 2012 Operational Highlights

  • For the full year of 2012, the Company opened 121 net new leased hotels and 221 net new manachised hotels, a total of 342 hotels, exceeding our previously announced guidance. As of December 31, 2012, the Company had 465 leased hotels, 516 manachised hotels, and 54 franchised Starway hotels in operation in 171 cities. The leased and manachised hotel rooms in operation increased by 35% and 72%, respectively, from a year ago.
  • As of December 31, 2012, the Company had a total pipeline of 410 new hotels, including 80 leased hotels and 330 manachised hotels.
  • For the full year of 2012, the occupancy rate for all hotels in operation (excluding franchised Starway hotels) was 94%, two percentage points higher than 2011. 
  • For the full year of 2012, the ADR was RMB178, compared to RMB180 in 2011. The decrease was primarily due to the shift of city mix of hotels toward lower-tier cities, partially offset by an increase in same-hotel ADR.
  • For the full year of 2012, the RevPAR for all hotels in operation, excluding franchised Starway hotels, was RMB168, a 2% increase from RMB165 in 2011.  RevPAR for leased hotel was RMB 173, a 4% increase from RMB167 in 2011.
  • For all the hotels which had been in operation for at least 18 months, excluding franchised Starway hotels, the same-hotel RevPAR was RMB186 in 2012, a 6% increase from RMB176 in 2011, with a 2% increase in ADR and a three percentage-point increase in occupancy rate.
  • As of December 31, 2012, the Company's loyalty program had more than 8 million members, who contributed more than 80% of room nights sold during the full year of 2012. In 2012, 96% of room nights were sold through the Company's own channels.

"We are delighted that we concluded 2012 with a strong result, exceeding 1,000 hotels and covering 171 cities," said Mr. Qi Ji, founder, executive Chairman and Chief Executive Officer of China Lodging Group. He continued: "Our blended hotel occupancy and RevPAR both improved even though we expanded scale and penetrated our business into lower-tier cities. Our same-hotel RevPAR for the full year improved by 6%, thanks to our strong brands, highly-motivated work force and well-established management system. In 2012, we made remarkable progress in executing our multi-brand strategy and proudly changed our Chinese name from Hanting to Hua Zhu. From Hi Inn to Joya Hotel, our product offerings now cover price range from RMB 100 to RMB 1000. We expect each of our brands to serve as a successful consolidator in its respective segment. We expect those successes, in whole, will make Hua Zhu a major force in the large and fast-growing China lodging market." 

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