Total revenues decreased 7.1% year over year to RMB352.2 million (US$48.8 million)[1]. Hotel revenues increased 8.8% year over year to RMB274.8 million. Income from operations was RMB72.2 million (US$10 million) compared to RMB52.3 million for the first quarter of 2023. Net income was RMB57.3 million (US$7.9 million) compared to RMB32.6 million for the first quarter of 2023. Adjusted EBITDA (non-GAAP)[2] increased 17.2% year over year to RMB109.4 million (US$15.2 million)[1]. Core net income (non-GAAP)[3] increased 21.5% year over year to RMB60.7million (US$ 8.4million)[1]
SHANGHAI, June 25, 2024 /PRNewswire/ — GreenTree Hospitality Group Ltd. (NYSE: GHG) ("GreenTree", the "Company", "we", "us" and "our"), a leading hospitality and restaurant management group in China, today announced its unaudited financial results for the first quarter of 2024.
[1] The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on the exchange rate of US$1.00=RMB 7.2203 on March 31, 2024 as set forth in H.10 statistical release of the U.S. Federal Reserve Board and available at https://www.federalreserve.gov/releases/h10/20220103/.
[2] Adjusted EBITDA (non-GAAP) is calculated as net income plus other operating expenses, income tax expense, share of loss in equity investees, net of tax, interest expense, depreciation and amortization, losses from investment in equity securities and other general expenses, but excludes other operating income, interest income and other, net, gains from investment in equity securities, share of gains in equity investees (net of tax), and other income, net. The calculation of Adjusted EBITDA (non-GAAP) included in this report has been aligned according to the above mentioned definition.
[3] Core net income is calculated as net income plus share-based compensation, losses from investments in equity securities (net of 25% tax), other expense(net of 25% tax), one-time fees and expense, and other general expenses but excludes government subsidies (net of 25% tax), gains from investment in equity securities (net of 25% tax), and other income (net of 25% tax).
First Quarter of 2024 Operational Highlights
Hotels
A total of 4,256 hotels with 313,531 hotel rooms were in operation as of March 31, 2024. The Company opened 109 hotels and had a pipeline of 994 hotels contracted for or under development as of March 31, 2024. The average daily room rate was RMB169, an increase of 0.9% from RMB167 in the first quarter of 2023. The occupancy rate was 67.8%, down from 71.7% in the first quarter of 2023. Revenue per available room, or RevPAR, was RMB114, a 4.6% year-over-year decrease.
Restaurants
A total of 185 restaurants were in operation as of March 31, 2024 The AC (average check) was RMB59, a 5.8% year-over-year increase. The ADT (average daily tickets) was 94, down from 109 in the first quarter of 2023. The ADS (average daily sales per store) was RMB5,525, a decrease of 8.7% from RMB6,051 in the first quarter of 2023.
"Overall, we delivered some significant improvements in the first quarter with substantial increases in both operating and net incomes.
Conditions in our hotel business were mixed as consumer behavior continued to evolve in a more competitive environment while we are continuously upgrading a large portion of hotels in our portfolio. Against this scenario, we managed to deliver an 8.8% revenue increase year over year and a 21.1% increase in hotel Adjusted EBITDA. We believe our business matrix will improve as we are completing these upgrades and open more new hotels.
We made further progress in the repositioning of our restaurant business with an absolute focus on robust profitability. We grew our network of franchisees as we further expanded the number of street stores. We have completed our closure of the restaurants in the supermarket anchored regional shopping centers, due to less foot traffic to our stores. We have now completed this phase of our forward strategy and are focused on store count growth again in regions where we have strong brand recognition," said Mr. Alex S. Xu, Chairman and Chief Executive Office of GreenTree.
First Quarter Of 2024 Financial Results
Quarter Ended
March 31, 2023
March 31, 2023
March 31, 2023
March 31, 2023
RMB
RMB
RMB
RMB
Hotel
Restaurant
Elimination
Total
Revenues
Leased-and-operated revenues
82,073,240
89,376,893
(559,217)
170,890,916
Franchised-and-managed
revenues
169,480,457
963,919
–
170,444,376
Wholesales and others
1,036,848
36,848,279
–
37,885,127
Total revenues
252,590,545
127,189,091
(559,217)
379,220,419
Quarter Ended
March 31,
2024
March 31,
2024
March 31,
2024
March 31,
2024
March 31,
2024
RMB
RMB
RMB
RMB
US$
Hotel
Restaurant
Elimination
Total
Total
Revenues
Leased-and-operated
revenues
122,541,793
46,367,979
–
168,909,772
23,393,733
Franchised-and-managed
revenues
151,159,511
1,535,341
–
152,694,853
21,147,993
Wholesales and others
1,144,727
29,753,299
(275,222)
30,622,804
4,241,209
Total revenues
274,846,031
77,656,619
(275,222)
352,227,429
48,782,935
Total revenues were 352.2 million (US$48.8 million), a 7.1% year-over-year decrease.
Hotel revenues were RMB274.8 million (US$38.1 million), an 8.8% year-over-year increase. The increase was mainly attributable to an 8.9% year-over-year increase in the RevPAR of L&O hotels and more newly opened L&O hotels since the second quarter of 2023, offset by a 4.9% year-over-year decrease in the RevPAR of F&M hotels.
Restaurant revenues were RMB77.7 million (US$10.8 million), a 38.9% year-over-year decrease. The decrease was mainly due to the strategic repositioning of this business, closing unprofitable L&O stores and opening more F&M stores.
Total revenues from leased-and-operated, or L&O, hotels and restaurants were RMB168.9 million (US$23.4 million)[1], a 1.2% year-over-year decrease.
Total revenues from L&O hotels were RMB122.5 million (US$17 million)[1], a 49.3% year-over-year increase. The increase was primarily attributable to an 8.9% year-over-year increase in the first quarter RevPAR of L&O hotels and new L&O hotels opened.
Total revenues from L&O restaurants were RMB46.4 million (US$6.4 million)[1], a 48.1% year-over-year decrease, mainly due to the closure of L&O restaurants and the year-over-year decrease in ADS.
Total revenues from franchised-and-managed, or F&M, hotels and restaurants were RMB 152.7million (US$21.1 million), a 10.4% year-over-year decrease.
Total revenues from F&M hotels were RMB151.2 million (US$20.9 million), a 10.8% year-over-year decrease. Initial franchise fees decreased 56.4% year-over-year, mainly due to the lower initial franchisee fee rate. Recurring franchisee management fees and others decreased 5.5% year-over-year, primarily due to a 4.9% decrease in F&M hotels’ Revpar.
Total revenues from F&M restaurants were RMB1.5 million (US$0.2million), a 59.3% year-over-year increase, as we opened more F&M stores.
Total revenues from wholesale and others were RMB30.6 million (US$4.2 million), a 19.2% year-over-year decrease, which was mainly due to the decline in the wholesale segment of the restaurant business.
Total operating costs and expenses
Quarter Ended
March 31, 2023
March 31, 2023
March 31, 2023
March 31, 2023
RMB
RMB
RMB
RMB
Hotel
Restaurant
Elimination
Total
Operating costs and expenses
Operating costs
134,236,998
109,219,983
(301,671)
243,155,310
Selling and marketing expenses
11,075,999
4,939,580
–
16,015,579
General and administrative
expenses
46,092,069
11,663,076
–
57,755,145
Other operating expenses
151,220
1,341,263
–
1,492,483
Impairment loss of goodwill
–
–
–
–
Other general expenses
11,664,345
–
–
11,664,345
Total operating costs and
expenses
203,220,631
127,163,902
(301,671)
330,082,862
Quarter Ended
March 31,
2024
March 31,
2024
March 31,
2024
March 31,
2024
March 31,
2024
RMB
RMB
RMB
RMB
US$
Hotel
Restaurant
Elimination
Total
Total
Operating costs and
expenses
Operating costs
146,226,642
62,149,597
(255,888)
208,120,351
28,824,336
Selling and marketing
expenses
15,454,623
2,954,313
(19,334)
18,389,602
2,546,931
General and administrative
expenses
38,469,631
9,171,998
–
47,641,629
6,598,289
Other operating expenses
666,301
1,541,981
–
2,208,282
305,844
Impairment loss of goodwill
–
–
–
–
–
Other general expenses
5,844,575
–
–
5,844,575
809,464
Total operating costs and
expenses
206,661,772
75,817,889
(275,222)
282,204,439
39,084,864
Operating costs were RMB208.1 million (US$28.8 million)[1], a 14.4% year-over-year decrease.
Operating costs of the hotel business were RMB146.2 million (US$20.3 million)[1], a 8.9% year-over-year increase. The increase was mainly attributable to higher utilities costs due to the improvement in L&O hotels’ RevPAR, and higher rental and personnel costs due to the increase in the number of L&O hotels and F&M hotels.
Operating costs of the restaurant business were RMB62.1million (US$8.6 million)[1], a 43.1% year-over-year decrease, due to closure of L&O stores.
Selling and marketing expenses were RMB18.4 million (US$2.5 million)[1], a 14.8% year-over-year increase.
Selling and marketing expenses of the hotel business were RMB15.5 million (US$2.1 million)[1], increased from RMB11.1 million one year ago. The increase was mainly attributable to the increase in business development and sales staff numbers.
Selling and marketing expenses of the restaurant business were RMB3.0 million (US$0.4 million)[1], a 40.2% year-over-year decrease, mainly attributable to lower sales staff related expenses after the closure of L&O stores.
General and administrative, or G&A expenses were RMB47.6 million (US$6.6 million)[1], a 17.5% year-over-year decrease.
G&A expenses of the hotel business were RMB38.5 million (US$5.3 million)[1], a 16.5% year-over-year decrease. The decrease was mainly due to the reversal of bad debt resulting from the decrease in long-aged accounts receivable.
G&A expenses of the restaurant business were RMB9.2 million (US$1.3 million)[1], a 21.4% year-over-year decrease, mainly due to lower staff related expenses and lower bad debts.
Other general expenses were RMB5.8 million (US$0.8 million)[1], a 49.9% year-over-year decrease. These expenses include provisions for loan receivables related to franchisee loans. The year-over-year decrease was attributable to the decrease in the loan balance thanks to the repayment of overdue debts.
Gross profit was RMB144.1 million (US$20.0 million)[1], a year-over-year increase of 5.9%. Gross margin was 40.9%, compared to 35.9% a year ago. The gross profit of the hotel business was RMB128.6 million (US$17.8 million)[1], an 8.7% year-over-year increase. The gross profit of the restaurant business was RMB15.5 million (US$2.1 million)[1], a 13.7% year-over-year decrease.
Income from operations was RMB72.2 million (US$10 million)[1] , compared to income from operations of RMB52.3 million in the first quarter of 2023, with a margin of 20.5%.
Income from operations of the hotel business was RMB70.4 million (US$9.7 million)[1], compared to an income from operations of RMB52 million in the first quarter of 2023, with a margin of 25.6%.
Income from operations of the restaurant business was RMB1.9 million (US$0.3 million)[1], compared to income from operations of RMB0.6 million in the first quarter of 2023, with a margin of 2.4%.
Net income was RMB57.3 million (US$7.9 million)[1], compared to a net income of RMB32.6 million in the first quarter of 2023, and net margin was 16.3%.
Net income of the hotel business was RMB57.3 million (US$7.9 million)[1], compared to a net income of RMB35.0 million in the first quarter of 2023, and net margin was 20.8%.
Net loss of the restaurant business was nil, compared to a net loss of RMB2.2 million in the first quarter of 2023.
Adjusted EBITDA (non-GAAP)[2] was RMB109.4 million (US$15.2 million)[1], a year-over-year increase of 17.2%. Adjusted EBITDA margin, defined as adjusted EBITDA (non-GAAP) as a percentage of total revenues, was 31.1%, compared to 24.6% a year ago.
Core net income (non-GAAP) [3] was RMB60.7 million (US$8.4 million)[1], a year-over-year increase of 21.5%. The core net margin, defined as core net income (non-GAAP) as a percentage of total revenues, was 17.2%, compared to 13.2% one year ago.
Earnings per American Depositary Share, or ADS, (basic and diluted) were RMB0.58 (US$0.08)[1], up from RMB0.36 one year ago. Core net income per ADS (basic and diluted) (non-GAAP) was RMB0.6 (US$0.08)[1], up from RMB0.49 a year ago.
Cash flow Operating cash inflow was RMB90.7 million (US$12.6 million)[1] as a result of income from operations. Investing cash inflow for the first quarter of 2024 was RMB213.1 million (US$29.5 million)[1], which was primarily attributable to proceeds from maturities of short-term investments and offset by the increase of long-term time investments. Financing cash inflow was RMB83.2 million (US$11.5 million)[1], mainly attributable to the drawing down of bank facilities and offset by the repayment of bank borrowings.
Cash and cash equivalents, restricted cash, short-term investments, investments in equity securities and time deposits. As of March 31, 2024, the Company had total cash and cash equivalents, restricted cash, short term investments, investments in equity securities and time deposits of RMB1,517.3 million (US$210.1 million)[1],compared to RMB1,337.1 million as of December 31, 2023.The increase was mainly due to continued improvement in our operating performance, drawing down of bank facilities, and repayment from franchisees.
Guidance
Based on our performance in the first five months of this year, we maintain our previous revenue guidance for the hotel business, that we expect to grow 7% to 12% year-over-year. We are withdrawing our guidance for the restaurant business given the significant revenue unpredictability resulting from its strategic repositioning.
The guidance set forth above reflects the Company’s current and preliminary views based on its recovery and may not be indicative of the final financial results for any future periods or the full year.
Conference Call
GreenTree’s management will hold an earnings conference call at 8:00 AM U.S. Eastern Time on June 25, 2024, (8:00 PM Beijing/Hong Kong Time on June 25, 2023).
Dial-in numbers for the live conference call are as follows:
International
1-412-902-4272
Mainland China
4001-201-203
US
1-888-346-8982
Hong Kong
800-905-945 or 852-3018-4992
Singapore
800-120-6157
Participants should ask to join the GreenTree call, please dial in approximately 10 minutes before the scheduled time of the call.
A telephone replay of the conference call will be available after the conclusion of the live conference call until July 2, 2024.
Dial-in numbers for the replay are as follows:
International Dial-in
1-412-317-0088
U.S. Toll Free
1-877-344-7529
Canada Toll Free
855-669-9658
Passcode:
2914023
Additionally, a live and archived webcast of this conference call will be available at http://ir.998.com.
Use of Non-GAAP Financial Measures
We believe that Adjusted EBITDA and core net income, as we present them, are useful financial metrics to assess our operating and financial performance before the impact of investing and financing transactions, income taxes and certain non-core and non-recurring items in our financial statements.
The presentation of Adjusted EBITDA and core net income should not be construed as an indication that our future results will be unaffected by other charges and gains we consider to be outside the ordinary course of our business.
The use of Adjusted EBITDA and core net income has certain limitations because it does not reflect all items of income and expenses that affect our operations. Items excluded from Adjusted EBITDA and core net income are significant components in understanding and assessing our operating and financial performance. Depreciation and amortization expense for various long-term assets, income tax and share-based compensation have been and will be incurred and are not reflected in the presentation of Adjusted EBITDA. Each of these items should also be considered in the overall evaluation of our results. Additionally, Adjusted EBITDA and core net income do not consider capital expenditures and other investing activities and should not be considered as a measure of our liquidity. We compensate for these limitations by providing the relevant disclosure of our depreciation and amortization, interest expense/income, gains/losses from investments in equity securities, income tax expenses, share-based compensation, share of loss in equity investes, government subsidies and other relevant items both in our reconciliations to the corresponding U.S. GAAP financial measures and in our consolidated financial statements, all of which should be considered when evaluating our performance.
The terms Adjusted EBITDA and core net income are not defined under U.S. GAAP, and Adjusted EBITDA and core net income are not measures of net income, operating income, operating performance or liquidity presented in accordance with U.S. GAAP. When assessing our operating and financial performance, you should not consider this data in isolation or as a substitute for our net income, operating income or any other operating performance measure that is calculated in accordance with U.S. GAAP. In addition, our Adjusted EBITDA and core net income may not be comparable to Adjusted EBITDA and core net income or similarly titled measures utilized by other companies since such other companies may not calculate Adjusted EBITDA and core net income in the same manner as we do.
Reconciliations of the Company’s non-GAAP financial measures, including Adjusted EBITDA and core net income, to the consolidated statement of operations information are included at the end of this press release.
About GreenTree Hospitality Group Ltd.
GreenTree Hospitality Group Ltd. ("GreenTree" or the "Company") (NYSE: GHG) is a leading hospitality and restaurant management group in China. As of March 31, 2023, GreenTree had a total number of 4,256 hotels and 185 restaurants. In 2023, HOTELS magazine ranked GreenTree 12th among the 225 largest global hotel groups in terms of number of hotels in its annual HOTELS’ 225. GreenTree was the fourth largest hospitality company in China in 2022 according to the China Hospitality Association. In 2023, GreenTree completed its acquisition of Da Niang Dumplings and Bellagio, two leading restaurant chain businesses in China.
GreenTree has a broad portfolio of diverse brands spanning from the economy to mid-scale, up-scale and luxury segments of the hospitality industry mainly in China. Through its strong membership base, expansive booking network, superior system management with moderate charges, and fully supported by its operating departments including Decoration, Engineering, Purchasing, Operation, IT and Finance, GreenTree aims to keep closer relationships with all of its clients and partners by providing a diverse brand portfolio that features comfort, style and value.
For more information on GreenTree, please visit http://ir.998.com
Safe Harbor Statements
This press release contains forward-looking statements made under the "safe harbor" provisions of Section 21E of the Securities Exchange Act of 1934, as amended, and the U.S. Private Securities Litigation Reform Act of 1995. In some cases, these forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to," "confident," "future," or other similar expressions. GreenTree may also make written or oral forward-looking statements in its reports filed with or furnished to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Any statements that are not historical facts, including statements about or based on GreenTree’s current beliefs, expectations, assumptions, estimates and projections about us and our industry, are forward-looking statements that involve known and unknown factors, risks and uncertainties that may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. Such factors and risks include, but not limited to the following: GreenTree’s goals and growth strategies; its future business development, financial condition and results of operations; trends in the hospitality industry in China and globally; competition in our industry; fluctuations in general economic and business conditions in China and other regions where we operate; the regulatory environment in which we and our franchisees operate; and assumptions underlying or related to any of the foregoing. You should not place undue reliance on these forward-looking statements. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the U.S. Securities and Exchange Commission. All information provided, including the forward-looking statements made, in this press release are current as of the date of the press release. Except as required by law, GreenTree undertakes no obligation to update any such information or forward-looking statements to reflect events or circumstances after the date on which the information is provided or statements are made, or to reflect the occurrence of unanticipated events.
Financial Tables and Operational Data Follow
GreenTree Hospitality Group Ltd.
Unaudited Condensed Consolidated Balance Sheets
March 31
March 31
March 31
2023
2024
2024
RMB
RMB
US$
ASSETS
Current assets:
Cash and cash equivalents
953,822,859
1,152,175,405
159,574,451
Restricted cash
2,720,982
4,532,526
627,748
Short-term investments
225,021,572
31,572
4,373
Investments in equity
securities
32,272,989
22,146,357
3,067,235
Accounts receivable, net of
allowance
142,262,308
122,414,456
16,954,206
Amounts due from related
parties
47,062,819
20,692,709
2,865,907
Prepaid rent
–
–
–
Inventories
29,534,072
8,400,721
1,163,486
Other current assets
139,201,294
126,002,104
17,451,090
Loans receivable, net
158,565,259
103,678,058
14,359,245
Total current assets
1,730,464,154
1,560,073,908
216,067,741
Non-current assets:
Amounts due from a related
party
112,360,000
110,000,000
15,234,824
Restricted cash
26,367,272
19,315,343
2,675,144
Long-term time deposits
–
285,570,000
39,550,988
Loans receivable, net
149,792,749
65,855,806
9,120,924
Property and equipment,
net
888,599,359
784,053,346
108,590,134
Intangible assets, net
173,172,989
116,036,169
16,070,824
Goodwill
128,752,950
177,082,468
24,525,639
Long-term investments
180,824,192
180,600,002
25,012,811
Operating lease
right-of-use assets
1,611,536,252
1,555,590,403
215,446,782
Other assets
115,656,298
107,382,513
14,872,306
Deferred tax assets
243,093,543
244,795,647
33,903,806
TOTAL ASSETS
5,360,619,758
5,206,355,605
721,071,923
LIABILITIES AND EQUITY
Current liabilities:
Long-term bank loans,
current portion
–
200,000
27,700
Short-term bank loans
278,500,000
200,000
27,700
Accounts payable
128,212,354
64,268,468
8,901,080
Advance from customers
30,083,605
18,436,298
2,553,398
Amounts due to related
parties
23,177,949
14,800,188
2,049,802
Salary and welfare payable
93,837,623
82,025,103
11,360,346
Deferred rent
–
–
–
Deferred revenue
197,096,092
192,051,020
26,598,759
Accrued expenses and
other current liabilities
555,241,803
423,194,165
58,611,715
Income tax payable
71,251,884
121,029,924
16,762,451
Dividends payable
–
–
–
Operating lease liabilities,
current
266,944,100
283,904,384
39,320,303
Deferred tax liabilities
34,408,879
–
–
Total current liabilities
1,678,754,289
1,200,109,550
166,213,254
Long-term bank loans
160,000,000
256,600,000
35,538,690
Deferred rent
–
–
–
Deferred revenue
230,935,621
195,259,974
27,043,194
Other long-term liabilities
121,625,146
118,615,555
16,428,065
Operating lease liabilities,
non-current
1,463,742,002
1,418,705,518
196,488,445
Deferred tax liabilities
36,591,348
97,657,120
13,525,355
Unrecognized tax benefits
365,027,137
389,681,763
53,970,301
TOTAL LIABILITIES
4,056,675,543
3,676,629,480
509,207,304
Shareholders’ equity:
Class A ordinary shares
222,587,070
222,587,070
30,827,953
Class B ordinary shares
115,534,210
115,534,210
16,001,303
Paid-in capital
94,000,801
–
–
Treasury Stock
(16,971,057)
(36,677,832)
(5,079,821)
Additional paid-in capital
1,491,516,416
1,680,729,011
232,778,279
Retained earnings
(Accumulated losses)
(665,211,634)
(509,443,169)
(70,557,064)
Accumulated other
comprehensive income
28,542,678
20,783,387
2,878,466
Total GreenTree
Hospitality Group Ltd.
shareholders’ equity
1,269,998,484
1,493,512,677
206,849,116
Non-controlling interests
33,945,729
36,213,449
5,015,505
Total shareholders’ equity
1,303,944,213
1,529,726,126
211,864,621
TOTAL LIABILITIES AND
SHAREHOLDERS’ EQUITY
5,360,619,758
5,206,355,605
721,071,923
GreenTree Hospitality Group Ltd.
Unaudited Condensed Consolidated Statements of Comprehensive Income
Quarter Ended
March 31,
2023
March 31,
2024
March 31,
2024
RMB
RMB
US$
Revenues
Leased-and-operated
revenues
170,890,916
168,909,772
23,393,733
Franchised-and-managed
revenues
170,444,376
152,694,853
21,147,993
Wholesales and others
37,885,127
30,622,804
4,241,209
Total revenues
379,220,419
352,227,429
48,782,935
Operating costs and
expenses
Operating costs
(243,155,310)
(208,120,351)
(28,824,336)
Selling and marketing
expenses
(16,015,579)
(18,389,602)
(2,546,931)
General and administrative
expenses
(57,755,145)
(47,641,629)
(6,598,289)
Other operating expenses
(1,492,483)
(2,208,282)
(305,844)
Impairment loss of goodwill
Other general expenses
(11,664,345)
(5,844,575)
(809,464)
Total operating costs and
expenses
(330,082,862)
(282,204,439)
(39,084,864)
Other operating income
3,159,519
2,225,933
308,288
Income from operations
52,297,076
72,248,923
10,006,359
Interest income and other,
net
7,629,014
8,946,539
1,239,081
Interest expense
(5,528,061)
(1,739,829)
(240,964)
Gains (losses) from
investment in equity
securities
(4,536,562)
(9,252,584)
(1,281,468)
Other income, net
(2,149,582)
13,234,570
1,832,967
Income before income
taxes
47,711,885
83,437,619
11,555,975
Income tax expense
(14,708,875)
(26,447,961)
(3,663,000)
Income (loss) before share
of gains in equity
investees
33,003,010
56,989,658
7,892,975
Share of loss/(income) in
equity investees, net of tax
(445,618)
305,209
42,271
Net income(loss)
32,557,392
57,294,867
7,935,246
Net loss/(income)
attributable to
non-controlling interests
3,768,594
1,601,766
221,842
Net income attributable to
ordinary shareholders
36,325,986
58,896,633
8,157,088
Net earnings per share
Class A ordinary share-basic
and diluted
0.36
0.58
0.08
Class B ordinary share-basic
and diluted
0.36
0.58
0.08
Net earnings per ADS
Class A ordinary share-basic
and diluted
0.36
0.58
0.08
Class B ordinary share-basic
and diluted
0.36
0.58
0.08
Weighted average shares
outstanding
Class A ordinary share-basic
and diluted
0.36
0.58
0.08
Class B ordinary share-basic
and diluted
0.36
0.58
0.08
Other comprehensive
income, net of tax
Foreign currency translation
adjustments
810,574
(7,617,895)
(1,055,066)
Unrealized gains(loss) on
available-for-sale
investments, net of tax
–
–
–
Comprehensive income,
net of tax
33,367,966
49,676,972
6,880,180
Comprehensive
loss/(income) attributable to
non-controlling interests
3,768,594
1,601,766
221,842
Comprehensive income
(loss) attributable to
ordinary shareholders
37,136,560
51,278,738
7,102,022
GreenTree Hospitality Group Ltd.
Unaudited Hotel Business Results
Quarter Ended
March 31,
2023
March 31,
2024
March 31,
2024
RMB
RMB
US$
Revenues
Leased-and-operated
revenues
82,073,240
122,541,793
16,971,842
Franchised-and-managed
revenues
169,480,457
151,159,511
20,935,350
Others
1,036,848
1,144,727
158,543
Total revenues
252,590,545
274,846,031
38,065,735
Operating costs and
expenses
Hotel operating costs
(134,236,998)
(146,226,642)
(20,252,156)
Selling and marketing
expenses
(11,075,999)
(15,454,623)
(2,140,441)
General and administrative
expenses
(46,092,069)
(38,469,631)
(5,327,982)
Other operating expenses
(151,220)
(666,301)
(92,282)
Other general expenses
(11,664,345)
(5,844,575)
(809,464)
Total operating costs and
expenses
(203,220,631)
(206,661,772)
(28,622,325)
Other operating income
2,608,096
2,182,615
302,289
Income from operations
51,978,010
70,366,874
9,745,699
Interest income and other,
net
7,475,298
8,930,356
1,236,840
Interest expense
(4,724,690)
(1,740,682)
(241,082)
Gains (losses) from
investment in equity
securities
(4,536,562)
(9,310,256)
(1,289,456)
Other income, net
(2,426,540)
13,304,900
1,842,707
Income before income
taxes
47,765,516
81,551,192
11,294,708
Income tax expense
(12,365,854)
(24,556,921)
(3,401,094)
Income (loss) before share
of gains in equity
investees
35,399,662
56,994,271
7,893,614
Share of loss/(income) in
equity investees, net of tax
(445,618)
305,209
42,271
Net income(loss)
34,954,044
57,299,480
7,935,885
GreenTree Hospitality Group Ltd.
Unaudited Restaurant Business Results
Quarter Ended
March 31,
2023
March 31,
2024
March 31,
2024
RMB
RMB
US$
Revenues
Leased-and-operated
revenues
89,376,893
46,367,979
6,421,891
Franchised-and-managed
revenues
963,919
1,535,341
212,642
Wholesales and others
36,848,279
29,753,299
4,120,784
Total revenues
127,189,091
77,656,619
10,755,317
Operating costs and
expenses
Restaurant operating costs
(109,219,983)
(62,149,597)
(8,607,620)
Selling and marketing
expenses
(4,939,580)
(2,954,313)
(409,168)
General and administrative
expenses
(11,663,076)
(9,171,998)
(1,270,307)
Other operating expenses
(1,341,263)
(1,541,981)
(213,562)
Total operating costs and
expenses
(127,163,902)
(75,817,889)
(10,500,657)
Other operating income
551,423
43,318
5,999
Income from operations
576,612
1,882,048
260,659
Interest income and other,
net
153,716
16,183
2,241
Interest expense
(803,371)
853
118
Gains (losses) from
investment in equity
securities
–
57,672
7,987
Other income, net
276,958
(70,330)
(9,741)
Income before income
taxes
203,915
1,886,426
261,264
Income tax expense
(2,407,407)
(1,891,040)
(261,906)
Income (loss) before share
of gains in equity
investees
(2,203,492)
(4,614)
(642)
Share of loss/(income) in
equity investees, net of tax
–
–
–
Net income(loss)
(2,203,492)
(4,614)
(642)
GreenTree Hospitality Group Ltd.
Unaudited Condensed Consolidated Statements
Quarter Ended
Quarter Ended
Quarter Ended
Quarter Ended
March 31, 2023
March 31, 2023
March 31, 2023
March 31, 2023
Hotel
Restaurant
Elimination
Total
RMB
RMB
RMB
RMB
Revenues
Leased-and-operated
revenues
82,073,240
89,376,893
(559,217)
170,890,916
Franchised-and-managed
revenues
169,480,457
963,919
–
170,444,376
Wholesales and Others
1,036,848
36,848,279
–
37,885,127
Total revenues
252,590,545
127,189,091
(559,217)
379,220,419
Operating costs and
expenses
Operating costs
(134,236,998)
(109,219,983)
301,671
(243,155,310)
Selling and marketing
expenses
(11,075,999)
(4,939,580)
–
(16,015,579)
General and administrative
expenses
(46,092,069)
(11,663,076)
–
(57,755,145)
Other operating expenses
(151,220)
(1,341,263)
–
(1,492,483)
Other general expenses
(11,664,345)
–
–
(11,664,345)
Total operating costs
and expenses
(203,220,631)
(127,163,902)
301,671
(330,082,862)
Other operating income
2,608,096
551,423
–
3,159,519
Income from operations
51,978,010
576,612
(257,546)
52,297,076
GreenTree Hospitality Group Ltd.
Unaudited Condensed Consolidated Statements
Quarter Ended
Quarter Ended
Quarter Ended
Quarter Ended
March 31, 2024
March 31, 2024
March 31, 2024
March 31, 2024
Hotel
Restaurant
Elimination
Total
RMB
RMB
RMB
RMB
Revenues
Leased-and-operated
revenues
122,541,793
46,367,979
–
168,909,772
Franchised-and-managed
revenues
151,159,511
1,535,341
–
152,694,853
Wholesales and Others
1,144,727
29,753,299
(275,222)
30,622,804
Total revenues
274,846,031
77,656,619
(275,222)
352,227,429
Operating costs and
expenses
Operating costs
(146,226,642)
(62,149,597)
255,888
(208,120,351)
Selling and marketing
expenses
(15,454,623)
(2,954,313)
19,334
(18,389,602)
General and
administrative expenses
(38,469,631)
(9,171,998)
–
(47,641,629)
Other operating expenses
(666,301)
(1,541,981)
–
(2,208,282)
Other general expenses
(5,844,575)
–
–
(5,844,575)
Total operating costs
and expenses
(206,661,772)
(75,817,889)
275,222
(282,204,439)
Other operating income
2,182,615
43,318
–
2,225,933
Income from operations
70,366,874
1,882,048
–
72,248,923
GreenTree Hospitality Group Ltd.
Unaudited Condensed Consolidated Statements of Cash Flows
Quarter Ended
March 31, 2023
March 31, 2024
March 31, 2024
RMB
RMB
US$
Operating activities:
Net (loss) income
32,557,392
57,294,867
7,935,247
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization
31,337,638
31,341,704
4,340,776
Impairment of long-lived assets
2,900,000
–
–
Share of （income）loss in equity method
investments
445,618
(305,209)
(42,271)
Noncash lease expense
64,053,832
64,818,043
8,977,195
Loss from disposal of a subsidiary
1,223,952
–
–
Interest income
(390,378)
–
–
Bad debt expenses
12,359,278
5,473,571
758,081
(Gains) losses and impairment on equity
securities held
4,536,562
9,252,584
1,281,468
Loss (gains) on disposal of property,
plant and equipment
(113,587)
2,352,048
325,755
Foreign exchange （gains）losses
987,543
(8,088,429)
(1,120,234)
Share-based compensation
(11,636)
15,662
2,169
Accounts receivable
(7,050,882)
1,844,427
255,450
Inventories
969,640
12,061,769
1,670,536
Amounts due from related parties
(961,185)
(397,603)
(55,067)
Other current assets
(7,726,682)
(5,490,017)
(760,359)
Other assets
4,964,235
(2,656,913)
(367,978)
Accounts payable
4,690,325
(8,858,209)
(1,226,848)
Amounts due to related parties
(1,632,355)
(1,876,431)
(259,883)
Salary and welfare payable
4,494,565
(4,306,993)
(596,512)
Deferred revenue
(4,481,873)
(6,876,613)
(952,400)
Advance from customers
3,602,826
(3,956,799)
(548,010)
Accrued expenses and other current
liabilities
76,271,975
(23,815,642)
(3,298,428)
Income tax payable
18,311,461
8,247,211
1,142,226
Unrecognized tax benefits
15,024,896
7,555,977
1,046,491
Operating lease liabilities
(56,063,542)
(41,913,938)
(5,805,013)
Other long-term liabilities
(6,570,885)
(1,096,187)
(151,820)
Deferred taxes
(28,194,988)
110,338
15,282
Net cash provided by operating
activities
165,533,745
90,729,218
12,565,853
Investing activities:
Purchases of property, plant and
equipment
(34,116,117)
(10,554,525)
(1,461,785)
Purchases of intangible assets
(42,454)
–
–
Proceeds from disposal of property, plant
and equipment
6,973,574
1,733,100
240,032
Proceeds from maturities of short-term
investments
91,400,378
419,362,037
58,080,971
Purchases of long-term investments
–
(222,230,000)
(30,778,500)
Proceeds from disposal of a subsidiary
18,900,000
–
–
Loan to third parties
(1,000,000)
–
–
Repayment of loan from third parties
468,319
1,371,953
190,013
Loan to franchisees
(7,029,596)
–
–
Repayment from franchisees
26,834,584
23,461,007
3,249,312
Net cash (used in) provided by
investing activities
102,388,688
213,143,572
29,520,043
Financing activities:
Repayment of bank loans
(136,600,000)
(116,800,000)
(16,176,613)
Proceeds from bank loans
117,000,000
200,000,000
27,699,680
Capital contribution from non-controlling
interest holders
–
–
–
Net cash provided by (used in)
financing activities
(19,600,000)
83,200,000
11,523,067
Effect of exchange rate changes on cash
and cash equivalents and restricted cash
(40,524)
(2,650,223)
(367,052)
Net (decrease) increase in cash and
cash equivalents
248,281,909
384,422,562
53,241,910
Cash and cash equivalents at the
beginning of the period
734,629,202
791,600,712
109,635,432
Cash and cash equivalents at the end
of the period
982,911,111
1,176,023,274
162,877,342
GreenTree Hospitality Group Ltd.
Unaudited Reconciliation of GAAP and Non-GAAP Results
Quarter Ended
March 31, 2023
March 31, 2024
March 31, 2024
RMB
RMB
US$
Net income
32,557,393
57,294,867
7,935,247
Deduct:
Other operating income
3,159,519
2,225,933
308,288
Interest income and other, net
7,629,014
8,946,539
1,239,081
Share of gain in equity investees, net of
tax
–
305,209
42,271
Other income, net
–
13,234,570
1,832,967
Add:
Other operating expenses
1,492,483
2,208,282
305,844
Other general expenses
11,664,345
5,844,575
809,464
Income tax expenses (benefits)
14,708,875
26,447,961
3,663,000
Share of loss in equity investees, net of
tax
445,618
–
–
Interest expenses
5,528,061
1,739,829
240,964
Depreciation and amortization
31,080,092
31,341,704
4,340,776
Losses from investment in equity
securities
4,536,562
9,252,584
1,281,468
Other expense, net
2,149,582
–
–
Adjusted EBITDA (Non-GAAP)
93,374,478
109,417,551
15,154,156
Quarter Ended
March 31, 2023
March 31, 2024
March 31, 2024
RMB
RMB
US$
Net income
32,557,393
57,294,867
7,935,247
Deduct:
Government subsidies (net of 25% tax)
396,060
259,886
35,994
Gains from investment in equity
securities (net of 25% tax)
–
–
–
Other income (net of 25% tax)
–
9,925,928
1,374,725
Add:
Share-based compensation
(11,636)
15,662
2,169
Losses from investments in equity
securities (net of 25% tax)
3,402,422
6,939,438
961,101
Other expense (net of 25% tax)
1,612,187
–
–
One-time fees and expenses
1,147,778
815,188
112,902
Other general expenses
11,664,345
5,844,575
809,464
Core net income (Non-GAAP)
49,976,429
60,723,916
8,410,164
Core net income per ADS (Non-GAAP)
Class A ordinary share-basic and diluted
0.49
0.60
0.08
Class B ordinary share-basic and diluted
0.49
0.60
0.08
Hotel Operational Data
March 31, 2023
March 31, 2024
Total hotels in operation:
4,084
4,256
Leased and owned hotels
64
66
Franchised hotels
4,020
4,190
Total hotel rooms in operation
302,425
313,531
Leased and owned hotels
6,992
7,392
Franchised hotels
295,433
306,139
Number of cities
355
345
Quarter Ended
2023 Q1
2024 Q1
Occupancy rate (as a percentage)
Leased-and-owned hotels
62.9 %
66.6 %
Franchised hotels
71.9 %
67.9 %
Blended
71.7 %
67.8 %
Average daily rate (in RMB)
Leased-and-owned hotels
229
235
Franchised hotels
166
167
Blended
167
169
RevPAR (in RMB)
Leased-and-owned hotels
144
157
Franchised hotels
119
113
Blended
120
114
Number of Hotels in Operation
Number of Hotel Rooms in
Operation
March 31,
2023
March 31,
2024
Marchr 31,
2023
March 31,
2024
Mid-to-up-scale
425
498
41,124
47,264
GreenTree Eastern
202
233
22,212
25,191
Deepsleep Hotel
7
7
534
534
Gem
54
75
4,845
6,588
Gya
69
74
5,809
6,121
Vx
86
95
7,492
8,263
Urban Garden and others
7
14
232
567
Mid-scale
2,952
2,942
230,729
230,362
GreenTree Inn
2,225
2,260
182,242
182,570
GT Alliance
544
493
38,084
37,290
GreenTree Dianjing
55
58
1,305
1,296
GreenTree Apartment
20
21
1,289
1,382
Vatica
108
110
7,809
7,824
City 118 Selected and others
–
–
–
–
Economy hotels
707
816
30,572
35,905
Shell
707
816
30,572
35,905
City 118 and others
–
–
–
–
Total
4,084
4,256
302,425
313,531
Restaurant Operational Data
March 31, 2023
March 31, 2024
Total restaurants in operation:
255
185
Leased and owned restaurants
116
27
Franchised restaurants
139
158
Number of cities
64
53
Da Niang Dumplings
219
153
Bellagio
36
32
Quarter Ended
2023 Q1
2024 Q1
ADT
Leased-and-owned restaurants
61
44
Franchised restaurants
48
50
Blended
109
94
AC (in RMB)
Leased-and-owned restaurants
67
80
Franchised restaurants
40
40
Blended
55
59
ADS (in RMB)
Leased-and-owned restaurants
4,135
3,484
Franchised restaurants
1,915
2,041
Blended
6,050
5,525
For more information, please contact:
GreenTree
Ms. Selina Yang
Phone: +86-158-2166-6251
E-mail: [email protected]
Mr. Maple Miao
Phone: +86-181-0184-0639
E-mail: [email protected]
Christensen
In Shanghai
Mr. Jerry Xu
Phone: +86-138-1680-0706
E-mail: [email protected]
In Hong Kong
Ms. Karen Hui
Phone: +852-9266-4140
E-mail: [email protected]
In the US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
E-mail: [email protected]
Source : GreenTree Hospitality Group Ltd. Reports First Quarter of 2024 Financial Results
>
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