GreenTree Hospitality Group Ltd. reported a 22.5% year-over-year decrease in total revenues for the third quarter of 2024, reaching RMB357.0 million (US$50.9 million). Hotel revenues declined 15.4% to RMB286.9 million (US$40.9 million), primarily due to a 13.6% decrease in RevPAR and the closure of six leased-and-operated (L&O) hotels. Restaurant revenues fell 42.0% to RMB70.6 million (US$10.1 million), mainly attributed to lower average daily sales (ADS) and a reduction in L&O stores.
Net income for the third quarter was RMB65.2 million (US$9.3 million), a significant decrease from RMB117.4 million in the same period last year, with a net margin of 18.3%. Earnings per American Depositary Share (ADS) were RMB0.65 (US$0.09), down from RMB1.15 a year ago. A foreign exchange loss of approximately RMB33 million negatively impacted the reported net income for the quarter.
Despite overall revenue declines, the restaurant business achieved positive net income for the second consecutive quarter. Franchised street stores now comprise 55.5% of the total restaurant count, up from 44.6% a year prior, reflecting the company's strategic pivot. Management stated that the strategic transformation of its business model was completed by the end of the third quarter.
Adjusted EBITDA (non-GAAP) decreased by 32.1% year-over-year to RMB122.5 million (US$17.5 million), resulting in an adjusted EBITDA margin of 34.3%. Core net income (non-GAAP) also saw a 26.6% year-over-year decrease to RMB93.5 million (US$13.3 million), with a core net margin of 26.2%. These figures indicate continued pressure on profitability despite strategic adjustments.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.