Atour Lifestyle Holdings Limited (ATAT) Q2 FY24 Earnings call transcript Aug 29, 2024

Atour Lifestyle Holdings, a leading player in China's hotel and retail sectors, reported a robust performance for the second quarter of 2024, showcasing impressive growth across its hotel and retail businesses. The company's management team provided insights into their strategies, financial performance, and future outlook during a recent earnings call.

Hotel Business

Atour Lifestyle Holdings' hotel business continued to demonstrate resilience, with a RevPAR of RMB 359 for the second quarter of 2024, representing 93.5% of its level in the same period of 2023. The company's OCC growth remained solid, reaching 101.7% of 2023's level for the same period. These figures underscore the company's ability to navigate market dynamics and capitalize on emerging opportunities.

Retail Business

The retail business also saw significant growth, with GMV up by 157.6% year-over-year to RMB 620 million. The company's e-commerce channels accounted for over 90% of the total GMV, highlighting the strategic importance of digital platforms in driving retail sales. Notably, the aTOUR PLANET brand excelled during the June 18 shopping festival, setting a new sales record and outpacing other brands in year-over-year sales growth.

New Product Innovations

Atour Lifestyle Holdings showcased its commitment to product innovation, particularly in the hotel segment. The launch of the Atour 4.0 hotel in Xian, embodying a serene retreat concept, has exceeded expectations, with an OCC surpassing 91% and a RevPAR of over RMB 710. This success underscores the market's endorsement of Atour's leading position in the upper mid-scale hotel market.

Future Outlook

Looking ahead, Atour Lifestyle Holdings expects its total net revenue to increase by 48% to 52% compared with the full year of 2023. This ambitious growth target is driven by the company's ongoing expansion of its hotel network and the rapid development of its retail business.

Challenges and Opportunities

Despite the challenges posed by market softness and high base effects, Atour Lifestyle Holdings remains confident in its ability to navigate these conditions. The company's focus on customer needs, product innovation, and strategic investments in technology and marketing are key drivers of its growth.

Investor Perspective

The earnings call provided valuable insights into the company's performance and future outlook, reassuring investors of its strong position in the hotel and retail sectors. The management's focus on customer needs, product innovation, and strategic investments bodes well for the company's long-term growth prospects.

In conclusion, Atour Lifestyle Holdings' strong Q2 performance and robust growth in both hotel and retail businesses highlight its strategic prowess and market leadership. The company's commitment to product innovation, customer satisfaction, and sustainable growth positions it well for future success. As Atour Lifestyle Holdings continues to expand its footprint and explore new opportunities, investors and stakeholders can look forward to a promising future.