On the evening of March 28th, NASDAQ: ATAT, the "first stock of China's new accommodation economy", released its second annual report since its listing, and the entire 2023 revenue and net profit doubled year-on-year.
Data shows that in 2023, Yaduo Group achieved a revenue of 4.666 billion yuan, a year-on-year increase of 106.2%; The adjusted net profit was 903 million yuan, a significant increase of 248.3% compared to 2022; The adjusted EBITDA was 1.207 billion yuan, a year-on-year increase of 184.3%. In the fourth quarter, Yaduo Group's revenue increased by 140.4% year-on-year to 1.505 billion yuan.
During the three-year period of the epidemic, many hotel groups in China were deeply affected by losses, and Yaduo was one of the few that maintained continuous profitability. In the first year of recovery after the epidemic, Yaduo's profit level reached a new high, with adjusted net profit exceeding the total of the previous three years.
Although it has once again proven its ability to make money, hidden dangers such as high operating costs and expenses, as well as high debt ratios, still plague Yaduo. According to the financial report, the total operating costs and expenses of Yaduo reached 3.825 billion yuan in 2023, accounting for over 80% of the total revenue. The asset liability ratio has decreased from 70.67% in the first half of last year to 68.73%. But the total debt scale has expanded, from 3.899 billion yuan in the first half of the year to 4.527 billion yuan.
Core business indicators have surpassed before the epidemic, and store expansion has accelerated
The accelerated recovery of the tourism industry has driven a strong recovery in the hotel industry, which was the direct reason for the significant increase in performance of Yaduo last year.
According to statistics from the Ministry of Culture and Tourism, the number of domestic tourists in 2023 was 4.891 billion, an increase of 2.361 billion compared to the same period last year, a year-on-year increase of 93.3%, and recovered to 81.38% of the 2019 (6.01 billion) number.
From the perspective of core operating indicators, the financial report shows that the average room rental revenue (RevPAR) of Yaduo Group hotels in 2023 was 377 yuan, recovering to 114.4% of the same period in 2019; The daily average housing price (ADR) was 464 yuan, recovering to 107.9% of the same period in 2019; The occupancy rate (OCC) reached 77.8%, returning to 106.0% of the same period in 2019. Among them, ADR and OCC have exceeded the same period level in 2019 for four consecutive quarters.
As a mid to high end hotel brand, Yaduo Hotel's business model includes two categories: managed franchise hotels and directly operated hotels, with managed franchise hotels dominating. As of the end of 2023, the number of franchised hotels was 1178, accounting for a high proportion of 97%, with the remaining 3% being directly operated hotels. However, in terms of revenue contribution, franchise hotels accounted for 57% of the revenue, while self operated hotels contributed 18% of the revenue.
The reason why self operated hotels can contribute higher revenue with a smaller volume is related to their level of operation. Yaduo's self operated hotels include 1 luxury brand, 8 high-end brands, and 22 mid to high end brands. Throughout 2023, the occupancy rate of 32 self operated hotels was 83.6%, significantly exceeding the 77.6% of franchise hotels; Driven by higher housing prices, the RevPAR of self operated hotels is also higher, reaching 517.2 yuan.
Yaduo's operating costs are also generated in hotel operations. According to the financial report, the operating cost of the entire 2023 Yaduo hotel was 2.24 billion yuan, accounting for 58% of the total cost. According to industry analysis, the Yaduo Hotel earns high premiums through personalized experiences and IP collaborations, but hotels with different styles have the characteristic of "non standardization". Moreover, style creation requires a significant amount of material and financial resources, making it difficult to replicate and transfer.
In order to maintain and seize a larger market share, accelerating expansion is the common goal of various hotel groups. At the beginning of 2023, Yaduo Group set the strategic goal of "China Experience, 2000 Good Stores" and plans to open 2000 high-quality hotels by the end of 2025. According to financial report data, in 2023, Yaduo Group opened a total of 289 new hotels and signed 576 new hotels, exceeding the target set at the beginning of the year. As of the end of 2023, the number of hotels operated by Yaduo Group has reached 1210.
Scene retail "side business" is making more money
In the fiercely competitive mid to high end hotel track, Yaduo has taken a differentiated path with labels such as artistic atmosphere and natural aesthetics. In addition to this, Yaduo has also developed a scenario retail business that other hotel groups do not have. Despite being ridiculed by the outside world as "neglecting his job", the retail business has indeed created a considerable income for Yaduo.
Yaduo stated that the retail business of Yaduo Group, which focuses on the development of "deep sleep" scenarios, achieved a two-way breakthrough in reputation and sales in 2023, creating a promising "second growth curve". Data shows that retail business achieved explosive growth in 2023, with a GMV of 1.139 billion yuan, a year-on-year increase of about 300%. Among them, the cumulative sales of deep sleep pillows PRO exceeded 1.2 million throughout the year, and the cumulative sales of deep sleep temperature control products exceeded 100000.
As a result, the importance of retail business revenue in the entire revenue structure of Yaduo Group is also increasing.
According to financial report data, the retail business revenue in 2022 was 254 million yuan, accounting for 11.18% of the total revenue; In 2023, the retail business revenue increased to 972 million yuan, accounting for 20.81% of the total revenue, even exceeding the revenue proportion of Yaduo's self operated hotels. In 2022, the revenue from retail business still ranks behind the revenue from self operated hotels.
Screenshot of Yaduo's financial report
Yaduo stated that the growth in retail business revenue is mainly due to the widespread recognition of retail brands and the improvement of product development and distribution capabilities. The interface news also noted that since 2024, Yaduo has increased the marketing and promotion of retail products on multiple platforms such as Tiktok. According to the official flagship store data of Yaduo Planet, the Deep Sleep Pillow PRO has ranked first in recent store sales, with a sold sales volume of 953000.