In 2021, the revenue and net profit of overseas hotel groups increased significantly, and the international market was the main force for expanding stores
In 2021, the room supply of the global hotel industry increased slowly, with a year-on-year increase of 2% in 2021, and RevPAR recovered to 66.6% before the epidemic. Review the performance of American Hotel Groups in 2021. Marriott International and Hilton are mainly high-end and above hotels, while intercontinental, Wyndham and select international are mainly economy / middle-end Hotels: 1) the revenue and net profit have increased significantly year-on-year, and the net profit of some hotel groups has significantly exceeded the pre epidemic level. Marriott achieved quarterly revenue growth in 2021. The annual revenue increased by 31.1% year-on-year, recovered to 66.1% in 2019, and the net profit was $1.099 billion. Compared with the loss of $267 million in 2020, Marriott significantly reversed its loss and recovered to 86% in 2019; The net profit of Wyndham and selected hotels significantly exceeded the pre epidemic level. In 2021, the annual revenue of Wyndham Hotel increased by 20.4% year-on-year, recovered to 76% in 2019, and the net profit was US $244 million, an increase of 55.4% year-on-year in 2019. In 2021, the annual revenue of selected international hotels increased by 38.1% year-on-year, recovered to 95.9% in 2019, and the net profit was US $289 million, an increase of 29.6% year-on-year in 2019. 2) During the epidemic, store expansion accelerated, and the international market became the core growth point. Marriott hotels grew by 4.5% year-on-year in 2021, down from 6.4% in 2019. 61% of the new hotel rooms are in the international market, and more than 40% of the hotels are luxury and full-service hotels; About 61.2% of Hilton pipeline hotel rooms are located in markets outside the United States, and the company has opened new markets in 28 countries and regions; The number of rooms to be built at Wyndham Hotel exceeded 194000, with a growth rate of 5%, a record high.
Trend 1: leisure travel takes the lead in the recovery and becomes a strong driving force for the recovery of the hotel industry
Since the second half of 2021, the passenger volume of flights between the United States and China has recovered to more than 80% of that before the epidemic, and the travel data has gradually stabilized. Compared with business travel, leisure travel faces fewer restrictions and shows stronger flexibility. According to the RevPAR situation of Wyndham Hotel, RevPAR on weekends increased by 3%, 16% and 19% respectively from Q2 to Q4 compared with that in 2019, significantly exceeding the level in the same period before the epidemic; The business income recovery of leisure demand of InterContinental Hotels exceeded that of business business. In December 2021, the rolling income of its leisure business in December increased by 10% compared with that in 2019, and the business income in the same period decreased by 10% compared with that in 2019. Under the strong recovery of leisure travel demand, ADR of hotel group has increased significantly, driving the recovery of RevPAR.
Trend 2: economy and mid tier hotels show stronger anti risk ability
During the epidemic period, compared with high-end and above hotels, the occupancy rate of economy / middle-end hotels was higher, driving the rapid recovery of RevPAR. According to STR data, RevPAR of mid-range hotels in the United States in 2021q4 increased by 5.3% year-on-year in 2019, while RevPAR of high-end and above hotels is still lower than that in the same period before the epidemic. Compared with the operating data of various brands of intercontinental hotels, the occupancy rate of economy / middle-end hotels recovered faster. In 2021q4, the occupancy rate recovered to 96% / 87% in the same period of 2019, higher than 75% / 76% of high-end and luxury brands. Driven by the occupancy rate, RevPAR of economy / middle-end hotels took the lead in recovering. RevPAR of 2021q4 recovered to 100% and 87% in the same period before the epidemic, far higher than 69% of high-end and luxury hotels.
Trend 3: limited service hotels are the first to recover compared with full-service hotels
Compared with Marriott’s full-service and limited service hotel businesses, the occupancy rate of limited service hotels was the first to recover during the epidemic period. In 2021q4, it recovered to 88% in the same period of 2019, higher than 75% of full-service hotels. The high occupancy rate led to the leading recovery of RevPAR of Limited service hotel business. In 2021q4, RevPAR of limited service hotels recovered to 87% in the same period before the epidemic, higher than 80% of full-service hotels. Compared with the operation data of various brands of Hilton Hotel, it also has this trend.
Investment advice
According to the tracking of the overseas hotel industry, we believe that, first of all, China Hotel Group focuses on the limited service hotel business, which is expected to recover rapidly; Secondly, leisure travel will lead business travel and take the lead in a strong rebound. Finally, limited by overseas home office, overseas business travel recovers slowly, while the degree of home office in China is low. Therefore, China’s leisure recovers strongly. At the same time, the hotel demand under business travel can also recover better.
1) recommend Shanghai Jin Jiang International Hotels Co.Ltd(600754) : the advantages of scale and brand are significant, and the market share of economical and mid-range hotels is high. It is expected to bring performance release with the recovery of industry prosperity.
2) recommendation Btg Hotels (Group) Co.Ltd(600258) : store expansion accelerated during the epidemic period. Under the three-year target of 10000 stores, the number of hotels opened in 21-23 years is expected to reach 27%; After being injected into Nuojin in 2022, the leisure business is expected to grow further.
3) recommend Zhejiang Ssaw Boutique Hotels Co.Ltd(301073) : the leader of China’s resort hotels, which is expected to open up new growth space after integrating Junlan and Jinglan; High ADR and the proportion of direct hotels bring high performance flexibility.
Risk tips
Repeated epidemics lead to less than expected travel demand; Store expansion speed is lower than expected; Intensified industry competition, etc.
