Atour Lifestyle Holdings Ltd. Q4 FY2024 earnings call

Key Points

• 2024 marked innovation and breakthroughs in Atour's three-year strategic roadmap, expanding brand influence and network. Opened 471 new hotels and signed 670 new projects in 2024.
• Hotel brands: Atour 4.0 had 16 in operation and 67 in pipeline; Atour Light 3.0 reached 100 hotels in operation.
• Retail business: Strong growth, with 2024 GMV up 127.7% y-o-y, and Double-11 2024 GMV over RMB 420 million.
• Membership ecosystem: Registered individual members over 89 million by end of 2024, +40% y-o-y. CRS channel accounted for 63.5% of Q4 room nights sold.

Hotel Business

• Fourth quarter RevPAR reached RMB 337, representing 94.1% of 2023's level. OCC stood at 98.2% of 2023's level, while ADR was 96% of 2023's level.
• Full year 2024: Opened 471 new hotels and signed 670 new projects. Mature hotels (in operation over 18 months) had same-hotel RevPAR in Q4 2024 at 96% of 2023's level, OCC 99% of 2023's, ADR 97.4% of 2023's.

Retail Business

• Full year 2024 retail GMV reached RMB 2.59 billion, +127.7% y-o-y. Fourth quarter retail revenue RMB 765 million, +85.6% y-o-y. Online channels contributed over 90% of total GMV.

Guidance

• 2025 total net revenues expected to increase 25% compared to 2024.
• Hotel openings: Expect to maintain similar growth rate as 2024, with full year target of 500 new hotels.
• Retail business: Expect retail revenue to grow no less than 35% y-o-y in 2025.

Risks

• High comparison base effect affecting ADR in hotels.
• Market uncertainties impacting RevPAR forecasts for 2025.

Q: Please share colors about the hotel's performance on RevPAR in first quarter 2025 and full year RevPAR assumption for 2025.

A: Due to high base effect, Q1 2025 RevPAR expected to decline mid- to high single digits y-o-y. 2025 RevPAR still uncertain, but group expects revenue to increase 25% y-o-y.

Q: What is the guidance on hotel openings and new signings in 2025?

A: Expect 500 new hotel openings in 2025. New signings expected to remain strong, with focus on quality control for new products like Atour 4.0 and Atour Light 3.0.

Q: What's the plan for the retail business in 2025 and revenue targets?

A: 2025 will enhance product R&D, expand new products in sleep categories, and retail revenue expected to grow no less than 35% y-o-y.

Q: How to guide the margin channel for 2025, especially for retail business?

A: Will optimize cost structure and improve management efficiency. Retail operating profit margin expected to remain stable in 2025.

Q: Share main strategy for high-end brand and Atour Light 3.0's performance?

A: Atour S and Sakura hotels developing; Atour Light 3.0 had over 100 hotels in operation by end of 2024, meeting expectations.

Q: Plans for hotel closures plan 2025 and shareholder return?

A: Will maintain similar pace of closures for hotels not meeting performance. Will continue to consider shareholder returns, aiming to distribute no less than 50% of net income annually over 3 years.