GreenTree Hospitality Group Ltd. Reports First Quarter of 2024 Financial Results
GreenTree Hospitality Group Ltd. Reports First Quarter of 2024 Financial Results

  • 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 incomeloss 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 gainslosses

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.

Originally published at https://www.prnewswire.com/news-releases/greentree-hospitality-group-ltd-reports-first-quarter-of-2024-financial-results-302181557.html
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