Huazhu Group Limited (NASDAQ:HTHT) Q4 2019 Earnings Conference Call - Final Transcript
Mar 26, 2020 • 09:00 pm ET
the Chinese government placed a series of travel restriction to prevent virus transmit.
Hotel business has been impacted significantly, no new orders and free cancellations result in zero hotel revenues. On the other hand, all hotel owners have to bear a big memorable monthly cash outflows for rental costs and labor costs. How to cope this situation then? It is still that hotel closure and staff layout are the brightest decision. To keep hotels open means you have to devote additional results to suffer more loss and even rent high risk of infection during pandemic. However, as Huazhu we keep our promise, provide safe and a clean stakes to our customer during their trips.
As an industrial leader, Huazhu has our owner persistence. After addressing all the possible risk and opportunities, we choose to keep hotels open and keep our staff and customers safe, backed by a well established platform. Fortunately, so far we have kept zero cross infection at our hotels. In addition, we are encouraged by more possible hotel re-opening and improved occupancy and RevPAR since early March.
How can we achieve that? Well, since the outbreak in China, Huazhu has set up a risk crisis task force that comprise of centralized money center, supported by 18 regional sub command centers. This task force communicat us on a daily basis to mobilize all available resource and co-ordinate effort from all parties within and outside of Huazhu network.
In addition, we are leveraging our internal information platform, a work [Indecipherable] to communicate our organized our collaborate --collaborative efforts, so that our employees and franchisees have timely access to critical information at their finger tips. To further elaborate on our key measures, one, we announced a new layoff and a new pay-cut on hotel staff, they are the core asset of our business. As Executive Chairman and CEO I personally take a zero salary. Our top and senior management take a 30% to 50% salary cut. Second, for the sake of our customers, we keep hotel open and provided them a reliable lodging for regular and special purpose during the outbreak.
Third, for our franchisees we provide timely emergency hotel safety supplies and make sure to get managers back to hotels. Local sales team try all their experience to get more governance -- government and corporate orders and sales quarantine room packages. In addition, we are the first in China to apply a temporary policy for fee reduction for our waves and expanding the city coverage from Wuhan to all over the country when the COVID-19 spread escalated. I would like to thank our employees, franchisees and partners for their great contribution to sustain their doings.
Now we're in the initial recovery stage, despite of the temporary challenge and disruption to our business as a leader we are confident about long-term growth for Chinese -- for China's lodging industry and our great potential for consolidating adequately to empowering the independent hotels after joining the Huazhu's brand family.
The aspect we