Core Viewpoint - The company's same-store sales are under pressure in 2024 due to external factors such as subdued dining trends and consumer spending, as well as internal adjustments [1][2] Group 1: Same-Store Sales Performance - In 2024, same-store revenue for brands such as Jiumaojiu, Taier, and Songhuoguo is expected to decline by -13%, -19%, and -32% respectively [1] - Jiumaojiu is less affected by the economic downturn due to its lower average transaction value of 55 yuan compared to Taier at 71 yuan and Songhuoguo at 103 yuan [1] Group 2: Operational Adjustments - The company is actively making adjustments to improve operations, including optimizing store models and menu structures [1][2] - Store renovations aim to create a warmer and more stylish environment suitable for family gatherings [1] - The menu is being updated to replace non-core dishes and introduce fresh fish, on-site slaughter, and specialty snacks [1] Group 3: Profitability and Financial Outlook - The company has slowed its expansion strategy in 2024, focusing on store upgrades and closures, which may enhance profitability [2] - The net profit attributable to the parent company for 2024 is projected at 56 million yuan, with core operating profit at 252 million yuan [2] - Profit recovery is anticipated in 2025, with net profits expected to reach 135 million yuan, 164 million yuan, and 203 million yuan for 2025-2027, representing year-on-year growth rates of 142.37%, 20.97%, and 24.05% respectively [2] Group 4: Supply Chain Development - The company is implementing supply chain improvements, with a central kitchen in Nansha, Guangzhou expected to be operational in 2025 [2] - Additional supply chain developments are planned for Shanghai and Chongqing in 2026-2027, which will support accelerated expansion outside the province [2] Group 5: Investment Rating - The company is viewed as being at the bottom of its fundamental performance, with positive adjustments and a potential turning point on the horizon [2] - Earnings per share (EPS) forecasts for 2025-2027 are 0.10, 0.12, and 0.15 yuan, with corresponding price-to-earnings ratios of 23.39x, 19.33x, and 15.59x [2]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company is focusing on optimizing store models and enhancing quality, with a shift from aggressive expansion to store upgrades and closures, which is expected to improve operating profit margins [7] - The company anticipates a recovery in 2025, driven by the closure of unprofitable stores and the introduction of a new store model that is expected to contribute to revenue growth and improved profitability [7] - The supply chain layout is gradually being implemented, with a central kitchen in Guangzhou expected to be operational in 2025, and further expansions planned for other regions in 2026-2027 [7] - The company forecasts significant growth in net profit from 2025 to 2027, with expected net profits of 135.26 million, 163.63 million, and 202.98 million respectively, reflecting year-on-year growth rates of 142.37%, 20.97%, and 24.05% [7] Financial Projections - Total revenue is projected to reach 6,110 million in 2025, with a year-on-year growth of 0.60% [1] - The earnings per share (EPS) is expected to be 0.10 in 2025, with a corresponding price-to-earnings (P/E) ratio of 23.39 [1] - The company’s operating profit is forecasted to improve significantly, with operating profits of 357.45 million in 2025 and 398.88 million in 2026 [8]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company is focusing on optimizing store models and enhancing quality, with a shift from aggressive expansion to store upgrades and closures, which is expected to improve operating profit margins [7] - The company anticipates a recovery in 2025, driven by the closure of unprofitable stores and the introduction of a new store model that is expected to contribute to revenue growth and improved profitability [7] - The supply chain layout is gradually being implemented, with a central kitchen in Guangzhou expected to be operational in 2025, and further expansions planned for other regions in 2026-2027 [7] - The company forecasts significant growth in net profit from 2025 to 2027, with expected net profits of 135.26 million, 163.63 million, and 202.98 million respectively, reflecting year-on-year growth rates of 142.37%, 20.97%, and 24.05% [1][7] Financial Summary - Total revenue is projected to grow from 6,074 million in 2024 to 6,895 million in 2027, with a compound annual growth rate of approximately 7.17% [1][8] - The earnings per share (EPS) is expected to increase from 0.04 in 2024 to 0.15 in 2027, indicating a positive trend in profitability [1][8] - The price-to-earnings (P/E) ratio is projected to decrease from 56.69 in 2024 to 15.59 in 2027, suggesting an improvement in valuation as earnings grow [1][8]

Investment Rating - The industry investment rating is "Positive" [1] Core Insights - The report highlights strong growth in the number of coffee and Western fast-food outlets, while the tea beverage segment is experiencing increasing differentiation [2] - The net opening numbers for various brands indicate a competitive landscape, with some brands expanding rapidly while others are contracting [3][4] Summary by Sections Net Opening Trends - In the first four months of 2025, the net opening numbers show significant growth for brands like KFC (+777), McDonald's (+52), and Luckin Coffee (+1474), while brands like Huaiyang and others are seeing declines [6][10] - The tea beverage segment shows mixed results, with brands like Mixue Ice Cream and Tea (+3123) expanding, while others like Heytea and Nayuki are facing contractions [8] Average Transaction Price Trends - The average transaction prices for major fast-food brands have shown a downward trend, with KFC and McDonald's experiencing declines of -3.9% and -2.1% respectively in recent months [7] - In the tea beverage sector, brands like Mixue and Heytea are also facing pressure on average transaction prices, with some brands showing significant declines [14] Coffee and Hot Pot Segment - The coffee segment is witnessing strong growth, with brands like Luckin Coffee and Manner showing net opening increases of 7% and 9% respectively [10] - The hot pot segment, however, is facing challenges, with brands like Haidilao and others showing minimal growth or declines in net openings [11] Other Food Categories - The report indicates a noticeable contraction in the number of outlets for categories like pickled fish and snacks, with brands like Tai Er and Yu Ni Zai Yi Qi showing negative net openings [13] - Average transaction prices in these categories are also under pressure, reflecting broader challenges in consumer spending [14]

Investment Rating - The industry investment rating is "Positive" [1] Core Insights - The report highlights strong growth in the number of coffee and Western fast-food outlets, while the tea beverage sector is experiencing increasing differentiation [2][3] - The net opening numbers for various brands indicate a competitive landscape, with some brands expanding rapidly while others are contracting [4][8] Summary by Sections Net Opening Trends - In the first four months of 2025, the net opening numbers for various sectors are as follows: - Coffee: 1,921 net openings, a 9% increase - Western fast food: 585 net openings, a 5% increase - Tea: -359 net openings, a 7% decrease [3][4] Customer Price Trends - Customer price trends for major brands show varying performance: - KFC: -1.6% in August 2023, worsening to -3.9% by December 2024 - McDonald's: -1.1% in August 2023, worsening to -0.1% by December 2024 - Starbucks: -1.1% in August 2023, worsening to -2.3% by December 2024 [7][12] Coffee and Hot Pot Sector - The coffee sector shows strong growth with notable net openings: - Luckin Coffee: 1,474 net openings, a 7% increase - Starbucks: 49 net openings, a 1% increase [10] - The hot pot sector shows mixed results with some brands experiencing declines in net openings [11] Tea Sector - The tea sector is characterized by a rapid expansion of certain brands like Mixue Ice Cream and Tea, which saw 3,123 net openings, a 9% increase, while others like Heytea and Nayuki are facing challenges with negative net openings [8][9] Other Food Categories - The report indicates a contraction in the number of outlets for categories like pickled fish and snacks, with brands like Tai Er and Yu Ni Zai Yi Qi showing negative net openings [13][14]

Core Viewpoint - The Chinese restaurant industry is experiencing a notable recovery driven by a shift in policy focus towards expanding domestic demand, with significant growth in consumer confidence and spending observed in the first quarter of 2024 [1][2]. Group 1: Market Performance - The Hong Kong restaurant index has rebounded over 20% since April 22, reaching around 787 points, with several restaurant companies like Xiaobai Xiaobai and Jiumaojiu showing positive performance [1]. - In Q1 2024, the offline consumption heat index increased by 14.2% year-on-year, with the dining sector growing by 14.5% [1]. - The overall revenue of the domestic restaurant industry in 2024 is projected to reach 55,718 billion yuan, marking a 5.3% increase compared to the previous year [2]. Group 2: Revenue and Profit Growth - The restaurant sector has shown double-digit growth in both revenue and profit, with 17 listed restaurant companies reporting an 11% increase in revenue and a 10% increase in profit for 2024 [5][6]. - The coffee and tea segment leads in revenue growth at 22.5%, while traditional Chinese dining (excluding hot pot) and fast food show growth rates of 6.3% and 5.6%, respectively [7]. Group 3: Store Expansion and Market Dynamics - The total number of restaurant stores increased by 20% in 2024, reaching 133,549, with coffee and tea stores growing by 24% [9][11]. - The closure rate of restaurants has risen to 61.2%, indicating a significant industry reshuffle [5]. - The trend of down-market expansion is evident, with 52% of restaurant stores located in third-tier cities and below [13]. Group 4: Strategic Adjustments and Innovations - Companies like Haidilao are adopting franchise models to penetrate lower-tier markets, with over 70% of franchise applications coming from these areas [14]. - New business models are being explored, such as Kudi Coffee's convenience store concept and Guoquan's community kitchen strategy [15]. - The restaurant sector is expected to stabilize in Q2 2025, with a potential recovery in valuation and fundamentals as seasonal demand increases [16].

Financial Performance - Jiumaojiu International Holdings Limited reported a revenue of HK$1.2 billion for the fiscal year 2024, representing a year-on-year increase of 15%[2]. - The company achieved a net profit of HK$300 million, which is a 20% increase compared to the previous year[2]. - Revenue for the year ended December 31, 2024, reached RMB 6,073,644, an increase from RMB 5,985,850 in 2023, representing a growth of 1.5%[27]. - Profit for the year was RMB 44,800, down from RMB 479,998 in 2023, indicating a decrease of 90.6%[27]. - Total comprehensive income for the year was RMB 104,787, compared to RMB 504,335 in 2023, a decrease of 79.2%[27]. - Profit before taxation decreased to RMB 74,008 in 2024 from RMB 636,384 in 2023, reflecting a decline of 88.4%[27]. - Core operating profit fell to RMB 252,272 in 2024 from RMB 632,077 in 2023, a drop of 60.1%[27]. - Store level operating profit for 2024 was RMB 748,320, a decline from RMB 1,076,967 in 2023, representing a decrease of 30.4%[27]. - The Group recorded a profit from equity investments at fair value through other comprehensive income of RMB 14.8 million for 2024, compared to a loss of RMB 8.9 million in 2023[141]. - Profit for the year plummeted by 90.7% from RMB 480.0 million in 2023 to RMB 44.8 million in 2024[140]. Customer and Market Growth - User data indicates that the number of active customers grew by 25% to 1.5 million in 2024[2]. - The company expects revenue growth to continue at a rate of 10-15% for the next fiscal year, driven by new product launches and market expansion[2]. - Jiumaojiu plans to introduce three new restaurant concepts in 2025, targeting a 30% increase in customer footfall[2]. - Market expansion efforts include opening 20 new locations across China in the next year, aiming for a 50% increase in market presence[2]. - The Group operates Tai Er restaurants in multiple countries including Singapore, Malaysia, Canada, the United States, Thailand, and Indonesia, with plans for further expansion in regions with significant Chinese populations[83]. Operational Challenges - The company reported a significant decline in profitability metrics, indicating challenges in operational efficiency and market conditions[27]. - Same store sales for Tai Er (self-operated) decreased by 18.8% to RMB 3,308,988 in 2024, while Song Hot Pot saw a decline of 31.6% to RMB 348,447[40]. - The Group's restaurant performance declined in 2024 due to external environmental changes and intensified competition in the catering market[64]. - The average spending per customer in 2024 decreased for most brands, with Tai Er at RMB 71 (down from RMB 75), Song Hot Pot at RMB 103 (down from RMB 113), and Jiu Mao Jiu at RMB 55 (down from RMB 58)[62]. Strategic Initiatives - The company is investing HK$100 million in technology upgrades to enhance customer experience and operational efficiency[2]. - The company is exploring potential acquisitions to diversify its portfolio and strengthen its market position[2]. - The company has implemented a new marketing strategy focusing on digital channels, which is expected to increase brand awareness by 40%[2]. - Ongoing research and development efforts are aimed at introducing new products and technologies to strengthen market position[27]. - The Group is focusing on optimizing product offerings and enhancing customer experience to strengthen brand competitiveness[77]. Financial Position and Ratios - Total assets decreased from RMB 6,520.9 million in 2023 to RMB 6,488.6 million in 2024, while total liabilities increased from RMB 3,163.9 million to RMB 3,337.5 million[170]. - The liabilities-to-assets ratio increased from 48.5% in 2023 to 51.4% in 2024, indicating a higher financial leverage[170]. - The current ratio decreased from 2.00 in 2023 to 1.45 in 2024, suggesting a decline in short-term financial health[171]. - Cash and cash equivalents decreased by 54.3% from RMB 1,326.9 million as of December 31, 2023 to RMB 607.0 million as of December 31, 2024, primarily due to dividends paid and purchases of non-current financial assets[177][180]. - The gearing ratio increased from 7.3% as of December 31, 2023 to 12.0% as of December 31, 2024, mainly due to an increase in bank loans and a decrease in total equity from dividend payments[178][181]. Employee and Staff Costs - Staff costs increased by 13.1% from RMB 1,544.1 million in 2023 to RMB 1,747.0 million in 2024, with its percentage of revenue increasing from 25.8% to 28.8%[112]. - As of December 31, 2024, the Group had a total of 20,735 employees, including outsourced personnel[199]. Future Outlook - The management remains optimistic about the overall market conditions and consumer spending trends in the upcoming quarters[2]. - Future outlook includes potential strategies for market expansion and product innovation to recover from the current downturn[27]. - The Group plans to adopt a more prudent restaurant opening strategy in 2025, with no specific target for new openings to ensure a 100% success rate for each restaurant[74].

Core Insights - Jiumaojiu's brand Taier Suancaiyu has completed upgrades in three stores in Guangzhou, focusing on a "fresh" concept with new product offerings like live fish, fresh chicken, and fresh beef [1][2] - The shift from a single signature dish to a diversified menu is a response to changing consumer preferences and increased competition in the restaurant market [2][3] Company Performance - Jiumaojiu reported a revenue of 6.074 billion yuan for 2024, a year-on-year increase of 1.47%, but the net profit attributable to shareholders dropped by 87.69% to 55.807 million yuan [2] - The revenue from Taier Suancaiyu, which has historically contributed over 70% of Jiumaojiu's income, fell by 1.4% to 4.41 billion yuan, with same-store sales declining by 18.8% [2] Market Dynamics - The adjustments made by Taier Suancaiyu are seen as necessary to cope with market changes, but the effectiveness of these changes remains to be seen [3] - The introduction of new dishes may attract a broader customer base, but it risks diluting the brand's identity and requires enhanced supply chain and kitchen management to maintain product quality [3]

Investment Rating - The report maintains a "Buy" rating for the company [2][8]. Core Insights - In 2024, the company achieved revenue of 6.074 billion yuan, a year-on-year increase of 1.47%. However, the net profit attributable to shareholders was 55.807 million yuan, a significant decline of 87.69%. The core operating profit was 252 million yuan, down 60.09% year-on-year [2][6]. - The company is set to enhance its supply chain capabilities with the expected launch of the Nansha supply chain center in Guangzhou in 2025, which is anticipated to lower costs related to raw materials. Additionally, the establishment of supermarket sales and online retail businesses in 2024 is expected to broaden external market opportunities [2][9]. - Revenue projections for 2025-2027 are estimated at 6.45 billion, 7.086 billion, and 7.825 billion yuan, with net profits of 194 million, 301 million, and 334 million yuan respectively [2][9]. Summary by Sections Financial Performance - The company reported a revenue of 6.074 billion yuan in 2024, with a year-on-year growth of 1.47%. The net profit attributable to shareholders was 55.807 million yuan, reflecting a decline of 87.69%. The core operating profit was 252 million yuan, down 60.09% year-on-year [2][6]. Operational Insights - The company faced challenges in restaurant performance, leading to a cautious approach in asset impairment provisions. The impairment losses for properties, plants, and equipment increased by 411.9% year-on-year, reaching 112 million yuan [6][9]. - In Q1 2025, the average daily sales for the main brands showed a slight increase compared to Q4 2024, with stable per-customer spending for two consecutive quarters [6][9]. Brand and Store Adjustments - In 2024, the company opened 150 new restaurants while closing 69, resulting in a total of 807 restaurants by the end of the year. The new brand "Shanwaimian" showed promising potential with a table turnover rate of 4.3 times per day and an average spending of 87 yuan [9][9]. - The company continued to adjust its brand matrix, with a reduction in the number of stores to 780 in Q1 2025, primarily due to closures in the "Tai Er" brand [9].

Investment Rating - The report maintains a rating of "Accumulate" for the company [4] Core Views - The company is facing performance pressure due to external environmental factors, with a cautious expansion strategy focusing on new stores and menu adjustments [2][3] - In 2024, the company achieved revenue of 6.074 billion yuan, a year-on-year increase of 1.5%, while the net profit attributable to shareholders was 56 million yuan, a significant decrease of 87.7% [1][3] - The company plans to optimize its brand portfolio and enhance supply chain capabilities, with new store openings and menu innovations expected to drive future growth [3][8] Financial Performance Summary - In 2024, the company reported a core operating profit of 252 million yuan, down 60.1% year-on-year [1] - For the second half of 2024, the company recorded a net profit of -16 million yuan, compared to 231 million yuan in the same period last year [3] - The revenue breakdown by brand for 2024 shows that Taier, Jiumaojiu, Song Hotpot, and other brands generated revenues of 4.413 billion, 546 million, 895 million, and 220 million yuan respectively, with year-on-year changes of -1.4%, -13.2%, +11.0%, and +201.4% [1] Store Expansion and Operations - The company opened 150 new stores in 2024, including 95 Taier stores and 28 Song Hotpot stores, while closing 69 stores [2] - As of the end of 2024, the total number of Taier stores reached 634, with a year-on-year increase of 56 stores [2] - The same-store sales for Taier decreased by 18.8% in 2024, while Song Hotpot saw a decline of 31.6% [2] Future Projections - Revenue projections for 2025, 2026, and 2027 are estimated at 6.761 billion, 7.878 billion, and 9.292 billion yuan respectively, with corresponding net profits of 99 million, 263 million, and 411 million yuan [9] - The company is expected to maintain a cautious approach to expansion while optimizing existing stores and menu offerings [8]