And according to some of the public study, we are expecting the business recovery business traveling will be fully recovered to the pre-COVID level in around 2024. Therefore, as a group we will be planning according to this trend. Okay. In terms of the franchisee’s confidence. So, after the three years of COVID, we think our existing franchisees are becoming more stable and more matured and they have better knowledge in terms of the volatility and uncertainties. So, we think they are very stable at this moment and the confidence is gradually improving as well. But we are also very happy to see, especially in the lower tier cities markets. We have a lot of new franchisees joining us and those franchises might not be previously in the hotel industry.
Some of them are the local property developers or some of them are from some other industries who are willing to join us. Thank you.
Sijie Lin : Thank you, management.
Operator: Thank you. Our next question comes from the line of Lydia Ling from Citi. Please go ahead, Lydia.
Lydia Ling: Thank you. Hi management. I’m Lydia from Citi. So, here I have two questions. The first one is on your overseas business. So, DH business actually is doing some loss making in first quarter, so want to check with management, your view on the DH and its outlook for full-year and also how to further narrow the loss and also any updates on the integration of DH business? And my second question is on the RevPAR growth. So, what’s your view on your sustainable long-term RevPAR growth looking forward? Thank you.
He Jihong: Okay. Thank you, Lydia. This is Jihong. I’m going to answer your question first about the DH business. First quarter you see a loss is because of the seasonality. We all understand that, especially European countries, the seasonality is quite strong and volatile. So, in the first quarter, the revenue was lower due to the seasonality and at the same time the cost because also of the energy cost and an inflationary environment increased our cost. For the whole year, we are very confident that we will continue to increase our performance on the revenue side and continue to control our cost. And we are confident that for the whole year, our EBITDA will come back to the positive territory. And the second question regarding the RevPAR, you can observe from the history of Huazhu we have been improving RevPAR year-by-year.
This is not only the same store, but also the product upgrade and the product mix as well. And typically, company’s RevPAR will grow with the economic growth as well. So, for the past several years and we are confident that in the future, our RevPAR will continue to grow with bigger economic environment.
Lydia Ling: Thank you.
Operator: Thank you. Our next question comes from the line of Lina Yan from HSBC. Please ask your question, Lina.
Lina Yan:
Jason Chen: Hi Lina, can you translate yourself?
Lina Yan: Yes, I will translate my question myself. So, first question is on the RevPAR drivers, especially on the pricing power for the ADR. So, we have seen very strong ADR increase in first quarter, driven by inelastic demand, but going forward, we will see the supply demand gap to narrow and also the spending power is not as strong as the economy has shown. So, also management guided RevPAR in second quarter will be 110% and 115% of 2019 level. Does that imply, management also see like a weakening trend in ADR or what kind of change in the mentality of the ADR trend like going forward? And second question is on the impact of portfolio upgrade on RevPAR. Management mentioned it’s like a key driver for RevPAR as well. So, can you quantify the impact, for example, like the percentage of like hotels upgraded in our portfolio versus 2019?
