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China Lodging Group, Limited Announces Its Preliminary Results for Hotel Operation in the Second Quarter of 2016

SHANGHAI, China, July 13, 2016 (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 preliminary results for the hotel operation in the second quarter ended June 30, 2016.

Hotel Development

Number of hotels in operation Number of rooms in operation
Opened Closed (1) Net added As of Net added As of
in Q2 2016in Q2 2016in Q2 2016June 30, 2016 in Q2 2016June 30, 2016
Leased and owned hotels2 (2)-627 (140)77,123
Manachised and franchised hotels172 (47)1252,487 10,523 237,688
Total 174 (49) 125 3,114 10,383 314,811
(1) Reasons for closures include contract expiration, operating loss and others.


Number of hotels in pipeline
as of June 30, 2016
Leased hotels23
Manachised and franchised hotels563
Total(2)586
(2) Including 31 hotels under brands of ibis, ibis Styles, Mercure and Novotel.


Operating Metrics

For the quarter ended
June 30,March 31,June 30,
201520162016
Occupancy rate (as a percentage)
Leased and owned hotels 87% 82% 87%
Manachised hotels 85% 81% 85%
Franchised hotels 74% 62% 71%
Blended 86% 80% 85%
Average daily room rate (3) (in RMB)
Leased and owned hotels 201 193 210
Manachised hotels 172 165 175
Franchised hotels 171 169 181
Blended 181 172 184
RevPAR (3) (in RMB)
Leased and owned hotels 176 159 182
Manachised hotels 146 133 150
Franchised hotels 126 105 128
Blended 156 139 157
(3) Value-added tax ("VAT") has been implemented for hospitality industry to replace business tax in China, effective May 1, 2016. The Company's room rates quoted and received from customers are tax-inclusive (business tax or VAT) before and after the implementation of VAT. For comparison purposes, the ADR and RevPAR disclosed in this release are based on the tax-inclusive rates.


Like-for-like performance for leased and manachised hotels opened for at least 18 months during the current quarter
As of and for the quarter ended
June 30,yoy
2015 2016 change
Total 1,899 1,899
Leased hotels 590 590
Manachised and franchised hotels 1,309 1,309
Occupancy rate (as a percentage) 88% 88% -0.4%
Average daily room rate (in RMB) 183 181 -0.7%
RevPAR (in RMB) 161 159 -1.2%


Business Update by Segment

Hotel breakdown by segment
Number of hotels in operation
Net added As of
in Q2 2016June 30, 2016
Economy hotels 84 2,732
HanTing Hotel 46 2,105
Leased hotels (1)492
Manachised hotels 47 1,613
Hi Inn 26 358
Leased hotels (1)37
Manachised hotels 21 285
Franchised hotels 6 36
Elan Hotel 11 180
Manachised hotels 7 149
Franchised hotels 4 31
ibis Hotel 1 83
Leased hotels 1 13
Manachised hotels 4 13
Franchised hotels (4)57
ibis Styles Hotel - 6
Manachised hotels - 2
Franchised hotels - 4
Midscale and upscale hotels 41 382
JI Hotel 27 229
Leased hotels 1 78
Manachised hotels 24 149
Franchised hotels 2 2
Starway Hotel 13 136
Leased hotels - 3
Manachised hotels 13 84
Franchised hotels - 49
Joya Hotel 1 5
Leased hotels - 2
Manachised hotels 1 3
Manxin Hotels & Resorts - 2
Leased hotels - 1
Manachised hotels - 1
Mercure Hotel - 8
Leased hotels - 1
Manachised hotels - 6
Franchised hotels - 1
Novotel Hotel - 1
Leased hotels - -
Manachised hotels - 1
Grand Mercure - 1
Franchised hotels - 1
Total 125 3,114


Same-hotel operational data by segment
Number of hotels in operationSame-hotel RevPAR Same-hotel ADR Same-hotel Occupancy
As ofFor the quarter ended For the quarter ended For the quarter ended
June 30,June 30,yoy
change
June 30,yoy
change
June 30,yoy
change
201520162015201620152016 2015 2016
Economy hotels1,7391,739152148 -3.0%172168 -1.9% 89% 88% -1.0%
Leased hotels522522159152 -4.1%179177 -1.6% 88% 86% -2.3%
Manachised and franchised hotels1,2171,217149146 -2.4%168164 -2.0% 89% 89% -0.3%
Midscale and upscale hotels160160230250 8.6%281290 2.9% 82% 86% 4.5%
Leased hotels6868263292 11.2%310322 3.8% 85% 91% 6.1%
Manachised and franchised hotels9292195204 4.6%248251 0.9% 79% 81% 2.8%
Total1,8991,899161159 -1.2%183181 -0.7% 88% 88% -0.4%


About China Lodging Group, Limited
China Lodging Group, Limited is a leading hotel operator and franchisor in China under 12 brand names. As of June 30, 2016, the Company had 3,114 hotels or 314,811 rooms in operation in 357 cities. With a primary focus on economy and midscale hotel segments, China Lodging Group’s brands include Hi Inn, HanTing Hotel, Elan Hotel, JI Hotel, Starway Hotel, Joya Hotel, and Manxin Hotels & Resorts. The Company also has the rights as master franchisee for Mercure, Ibis and Ibis Styles, and co-development rights for Grand Mercure and Novotel, in Pan-China region.
The Company’s business includes leased, manachised and franchised models. Under the lease model, the Company directly operates hotels typically located on leased properties. Under the manachise model, the Company manages manachised hotels through the on-site hotel managers it appoints and collects fees from franchisees. Under the franchise model, the Company provides training, reservation and support services to the franchised hotels and collects fees from franchisees but does not appoint on-site hotel managers. The Company applies a consistent standard and platform across all of its hotels. As of June 30, 2016, China Lodging Group operates 24 percent of its hotel rooms under lease model, 76 percent under manachise and franchise models.
For more information, please visit the Company’s website: http://ir.huazhu.com.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: The information in this release contains forward-looking statements which involve risks and uncertainties. Such factors and risks include our anticipated growth strategies; our future results of operations and financial condition; the economic conditions of China; the regulatory environment in China; our ability to attract customers and leverage our brand; trends and competition in the lodging industry; the expected growth of the lodging market in China; and other factors and risks detailed in our filings with the Securities and Exchange Commission. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements, which may be identified by terminology such as “may,” “should,” “will,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “forecast,” “project,” or “continue,” the negative of such terms or other comparable terminology. Readers should not rely on forward-looking statements as predictions of future events or results.
The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.

Contact Information Ida Yu Sr. Manager of Investor Relations Tel: 86 (21) 6195 9561 Email: ir@huazhu.com http://ir.huazhu.com

Source:China Lodging Group, Limited