Core Insights - Green Hotel Group (GHG) experienced a stock price increase of 4.28%, reaching $2.336 per share, with a total market capitalization of $237 million as of July 29 [1] - Financial data indicates that as of December 31, 2024, GHG's total revenue was 1.343 billion RMB, a year-on-year decrease of 17.44%, while net profit attributable to shareholders was 110 million RMB, down 59.16% year-on-year [1] Company Overview - Green Hotel Group, founded in 2004 and listed on the NYSE in March 2018, is a leading hotel management group in China [2] - As of June 30, 2021, the company operated and was developing nearly 6,000 hotels across approximately 360 cities in China, with international presence in the US, Japan, South Korea, and Southeast Asia [2] - The group has a membership base of nearly 70 million individual members and approximately 1.8 million corporate members [2] - GHG has established a comprehensive product system with various well-known brands, including Yage, Yage Boutique, Auster, Green Oriental, and Green Hantang, covering high-end, mid-range, and economy hotel markets [2]

Core Points - GreenTree Hospitality Group Ltd. filed its annual report on Form 20-F for the fiscal year ended December 31, 2024, with the SEC on April 30, 2025 [1] - The annual report includes audited consolidated financial statements and is available on the Company's investor relations website and the SEC's website [2] Company Overview - GreenTree Hospitality Group Ltd. is a leading hospitality and restaurant management group in China, with a total of 4,425 hotels and 182 restaurants as of December 31, 2024 [3] - In 2023, GreenTree was ranked 11th among the 225 largest global hotel groups by HOTELS magazine and was the fourth largest hospitality company in China according to the China Hospitality Association [3] - The Company completed the acquisition of Da Niang Dumplings and Bellagio, two prominent restaurant chain businesses in China, in 2023 [3] Business Model and Strategy - GreenTree has a diverse brand portfolio that spans economy to luxury segments in the hospitality industry, primarily in China [4] - The Company leverages a strong membership base, expansive booking network, and superior system management to maintain close relationships with clients and partners [4]

Economic and Regulatory Environment - The company primarily operates in China, and its revenues are highly sensitive to economic conditions, with a significant risk of adverse effects from a slowdown in China's economy [23]. - The RMB depreciated approximately 8.2%, 2.9%, and 2.8% against the U.S. dollar in 2022, 2023, and 2024, respectively, which could impact the company's financial performance [35]. - The company relies on dividends from its PRC subsidiaries for cash needs, making it vulnerable to fluctuations in the RMB and foreign currency exchange rates [36]. - The PRC government has significant control over currency conversion, which may limit the company's ability to utilize revenues effectively and affect the value of investments [34]. - Changes in the PRC government's economic policies could materially affect the company's growth strategy and financial condition [26]. - The company faces legal and operational risks due to the PRC government's enhanced regulatory oversight of companies listing overseas, which could affect its ability to conduct business [25]. - Political tensions between the U.S. and China may adversely affect trade and investment levels, impacting the company's operations and investor confidence [32]. - The company has not entered into any hedging transactions to mitigate foreign currency exchange risk, which may expose it to significant financial losses [37]. - The company may face challenges in obtaining necessary permissions or approvals from PRC governmental agencies, which could hinder its operations [25]. Financial Structure and Taxation - As of December 31, 2022, total statutory reserves of the company's PRC subsidiaries were RMB150.2 million (US$21.3 million), which are not distributable as cash dividends [53]. - The company's PRC subsidiaries are restricted in their ability to transfer net assets, with paid-up capital and statutory reserve funds amounting to RMB898.6 million (US$117.6 million) as of December 31, 2022 [53]. - The company relies on dividends and other distributions from its subsidiaries to fund cash requirements, and any limitations on these payments could adversely affect its liquidity [53]. - The company may be subject to a 25% PRC income tax on worldwide income if considered a PRC "resident enterprise" under the Enterprise Income Tax Law [58]. - The tax resident status of the company remains uncertain, with risks associated with the interpretation of "de facto management body" by PRC tax authorities [61]. - If deemed a PRC resident enterprise, the company may have to withhold 10% tax on dividends paid to non-PRC resident enterprise investors and 20% for non-PRC resident individual investors [62]. - The company's acquisition of equity interests in PRC operating subsidiaries may be classified as an indirect transfer of PRC taxable assets, potentially subjecting it to a 25% PRC enterprise income tax [63]. Operational Risks and Compliance - The company faces operational risks with fixed costs in leased-and-operated hotels and restaurants, which may lead to disproportionate decreases in earnings during revenue declines [100]. - The company may not be able to renew existing leases on commercially reasonable terms, potentially leading to increased operating costs and decreased profits [110]. - The company has sought to convert hotels and restaurants from a leased-and-operated model to a franchised-and-managed model, which involves transferring operational risks to new franchisees [99]. - The company may face fines ranging from RMB5,000 to RMB50,000 for non-compliance with health certificate regulations for employees, with potential suspension of operations for serious violations [92]. - The company may incur fines of up to RMB 30,000 for each property, totaling approximately RMB 480,000, due to discrepancies in property title certificates [104]. - The company is subject to various operational risks, including fluctuations in occupancy rates and average daily sales, which could adversely affect financial performance [82]. - Regulatory non-compliance by franchisees could result in significant liability claims and impact the company's financial condition [93]. - The company may face challenges in securing necessary governmental approvals and permits, which could delay operations and impact business performance [81]. Growth and Market Position - The company plans to increase the number of franchised-and-managed hotels and restaurants to enhance its national presence in China [79]. - As of December 31, 2024, approximately 98.8% of the hotels operated by the company are franchised-and-managed, contributing 62.2%, 58.4%, and 58.6% of revenues in 2022, 2023, and 2024 respectively [79]. - The company completed the acquisition of Da Niang Dumplings and Bellagio, two leading restaurant chains in China, in 2023 [118]. - The company plans to diversify its brand portfolio and hospitality offerings, covering market segments from economy to upscale [124]. - The company is well-positioned to capture growth opportunities in China's hospitality industry, particularly in Tier 3 and lower cities [217]. - From 2012 to 2024, the company grew its hotel network from 792 to 4,425 hotels, achieving a compound annual growth rate (CAGR) of 14.2% [217]. - The total number of hotels in operation in China increased from 8 in 2005 to 4,425 by the end of 2024 [118]. Management and Human Resources - The company relies heavily on the experience of its senior management team, particularly the CEO, and losing key personnel could hinder effective business management and growth strategies [135]. - Difficulty in hiring, training, and retaining qualified managerial staff may adversely affect service quality and brand reputation across hotels and restaurants [136]. - The company faces risks related to managing growth, including the ability to recruit and retain qualified personnel and integrate new acquisitions [120]. Legal and Governance Issues - The PCAOB was unable to inspect the company's auditor before 2022, which may have deprived investors of the benefits of such inspections [70]. - Following the PCAOB's inspections in late 2022, the auditor is no longer classified as one that cannot be inspected, reducing the risk of being identified as an SEC-identified issuer [75]. - If the company is identified as an SEC-identified issuer for two consecutive years, it may face delisting from the NYSE and restrictions on trading its securities in the U.S. [76]. - The company is a "controlled company," with GTI owning 84.8% of Class A shares and 100% of Class B shares, affecting corporate governance [162]. - The concentration of share ownership among executive officers and directors, who own approximately 90% of outstanding shares, may limit shareholder influence on corporate matters [184]. - The company is exempt from certain U.S. disclosure requirements as a foreign private issuer, potentially affording less protection to ADS holders [187]. Financial Performance and Market Risks - The market price for the company's ADSs may be highly volatile, influenced by various factors including market conditions and operational performance [179]. - Future sales of ADSs or other equity securities could lead to a decline in the market price of the company's ADSs [183]. - The company may require additional financing for growth and development, which could increase financial leverage and be difficult to service [168]. - The company is subject to various claims and disputes that could adversely affect its operating results and financial condition [157]. - The company may not be able to maintain effective internal controls, which could lead to material misstatements in financial statements and loss of investor confidence [175]. Intellectual Property and Data Security - As of December 31, 2024, the company holds 732 trademarks, 63 software registration certificates, and 3 copyrights, with potential risks in maintaining these intellectual property rights [146]. - Unauthorized access to proprietary internal and customer data poses significant risks, potentially leading to reputational harm and legal liabilities [139]. - Compliance with evolving data protection regulations in China may incur substantial costs and require changes in business practices [142]. Health and Safety Risks - The restaurant business faces risks related to food-borne illnesses, which could negatively impact sales and customer confidence if incidents occur [149]. - Accidents or injuries in hotels and restaurants could adversely affect the company's reputation and lead to liability issues, with insurance coverage potentially being inadequate [150].

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was RMB 304 million, a decrease of 18.2% year-over-year [12] - Hotel revenues were RMB 240.2 million, a decrease of 17.1% primarily due to the closure of 12 leased and managed hotels and a year-over-year decrease in RevPAR of 9% [12][21] - Net income was negative RMB 72.8 million, mainly due to impairment of goodwill and trademarks [13] - Adjusted net income, excluding these impacts, was RMB 77.3 million, an increase of 26.8% with a margin of 25.4% [13] - Cash from operations increased to RMB 74.2 million from a negative RMB 13.5 million a year ago [14][30] Business Line Data and Key Metrics Changes Hotel Business - RevPAR for L&O hotels decreased by 9.6% to RMB 116, while F&M hotels saw a decrease of 9.8% to RMB 115 [12][15] - Total Hotel operating costs decreased by 10.5% year-over-year to RMB 225.7 million [23] - Net income from the Hotel business was RMB 28.4 million, compared to RMB 8.1 million in Q4 2023 [26] Restaurant Business - Restaurant revenues were RMB 65.1 million, a decrease of 25.8% year-over-year [27] - Same-store revenue decreased by 3.1% to RMB 31.2 million [28] - Cash from operations for the Restaurant business turned positive at RMB 5.5 million in Q4 2024 [29] Market Data and Key Metrics Changes - Individual memberships grew to 102 million, up from 91 million a year ago, while corporate memberships grew to 2.17 million from 2.05 million [16] Company Strategy and Development Direction - The company plans to open approximately 480 new hotels in 2025, an increase from 405 in 2024, while continuing to upgrade existing hotels [8][44] - Focus on expanding the mid to upscale segment, with a strategic commitment to retain flagship properties in key cities [9] - The Restaurant business is shifting towards franchised and managed stores, which accounted for almost 90% of all stores by the end of the quarter [10][19] Management's Comments on Operating Environment and Future Outlook - Management expects RevPAR to remain flat for 2025, with a gradual recovery anticipated in the second and third quarters [38] - There is a noted increase in leisure travel demand compared to business travel [38] - The company is focused on improving operational efficiency and profitability across both Hotel and Restaurant segments [45][53] Other Important Information - As of December 31, 2024, total cash and cash equivalents were RMB 1,839.1 million, a decrease from RMB 1,883.9 million as of September 30, 2024 [33] - The company expects to close about 200 hotels for a net addition of 280 hotels in 2025 [34] Q&A Session Summary Question: What is the RevPAR assumption for the full year flat Organic Hotel revenue forecast? - Management expects RevPAR to be flat for 2025, with a 5% decrease observed in Q1 and a gradual recovery anticipated in subsequent quarters [36][38] Question: Can you provide an overview of the strategy for the Hotel business in 2025? - The company plans to open 480 new hotels and upgrade existing aged hotels, with a completion target by summer 2026 [42][44] Question: Why are so many L&O hotels being closed? - Closures are due to expired leases and a strategic focus on flagship hotels in Tier 1 locations, with a shift towards franchised and managed segments [46][47] Question: Will the trend of increasing Street stores continue in the Restaurant business? - Management expects this trend to continue, focusing on Street stores due to stable consumer traffic and better control over operating hours [50][51] Question: What can be expected in 2025 regarding new restaurant openings? - The company aims to deliver 60 new restaurant openings in 2025, following a profitable operation for existing restaurants [54][55] Question: Any progress on increasing trading liquidity in shares? - Management is evaluating options to increase liquidity, including a planned reverse merger [58][60]

Q4 2024 Performance Overview - Total revenues decreased by 18.2% to RMB 304.5 million compared to Q4 2023[19] - Hotel revenues decreased by 17.1% to RMB 240.2 million compared to Q4 2023[19] - Restaurant ADS (Average Daily Sales Per Store) decreased by 22.3%[19] - Net income was negative RMB 72.8 million, a significant decrease compared to the RMB 8.6 million net income in Q4 2023[19, 114] - Adjusted EBITDA decreased by 38.3% to RMB 71.5 million with a margin of 23.5%[19] Hotel Business Highlights - Hotel RevPAR decreased to RMB 116[19] - Revenue from F&M hotels decreased to RMB 148.2 million[77] - Revenue from L&O hotels decreased to RMB 70.6 million[75] - Total hotels in operation increased from 4,238 in 2023Q4 to 4,425 in 2024Q4[147] Restaurant Business Highlights - Restaurant total revenue decreased to RMB 65.1 million[97] - Restaurant net income excluding impairment of goodwill and trademarks increased to RMB 18.9 million[104] - Total restaurants in operation decreased from 194 in 2023Q4 to 182 in 2024Q4[148]

Financial Data and Key Metrics Changes - In Q4 2024, total revenue decreased by 18.2% year-over-year [11] - Hotel revenues were RMB240.2 million, a decrease of 17.1% [12] - Net income was negative RMB72.8 million, primarily due to impairments [12] - Adjusted net income increased by 26.8% to RMB77.3 million, with a margin of 25.4% [12] - Core net income decreased by 22.3% to RMB57.8 million, with a margin of 19% [12] - Adjusted EBITDA was RMB71.5 million, a decrease of 38.3% [12] - Cash from operations increased to RMB74.2 million from negative RMB13.5 million a year ago [12][25] Business Line Data and Key Metrics Changes - Hotel RevPAR decreased by 9.6% to RMB116 compared to Q4 2023 [11] - Restaurant ADS decreased by 16.8% [11] - Total revenues from LO hotels were RMB91 million, a 27.5% year-over-year decrease [19] - Total revenues from FM hotels were RMB148.2 million, a 9% year-over-year decrease [19] - Restaurant revenues were RMB65.1 million, a 25.8% year-over-year decrease [22] Market Data and Key Metrics Changes - RevPAR for LO hotels decreased by 2.1% to RMB158 [13] - RevPAR for FM hotels decreased by 9.8% to RMB115 [13] - Occupancy at LO hotels decreased to 65.5% from 66.9% [14] - Occupancy at FM hotels decreased to 68.6% from 72.5% [14] - Individual memberships grew to 102 million, up from 91 million a year ago [14] Company Strategy and Development Direction - The company plans to open approximately 480 new hotels in 2025, an increase from 405 in 2024 [9] - Focus on upgrading existing hotels with a target completion by summer 2026 [9] - Strategic transformation of the restaurant business with a focus on franchised and managed stores, which accounted for almost 90% of all stores [10] - Continued phased closure of leased and managed hotels in lower-tier cities [9] Management's Comments on Operating Environment and Future Outlook - Management expects flat organic hotel revenue for 2025, with a gradual recovery in RevPAR [30] - Observations indicate a shift towards leisure travel over business travel [30] - The company is focusing on flagship hotels in Tier one cities and franchise management [39] - Confidence in achieving 60 new restaurant openings in 2025 [48] Other Important Information - Total cash and cash equivalents decreased to RMB1,839.1 million as of December 31, 2024 [25] - The company plans to close about 200 hotels for a net addition of 280 hotels in 2025 [26] Q&A Session Summary Question: What is the RevPAR assumption for the full year flat organic hotel revenue forecast? - Management expects RevPAR to be flat for 2025, with a 5% decrease in Q1 and gradual recovery in subsequent quarters [30] Question: Overview of the strategy for the hotel business in 2025? - Plans to open 480 new hotels and upgrade existing hotels, focusing on flagship locations [35][36] Question: Why are so many LO hotels being closed? - Closures are due to lease expirations and a focus on flagship hotels in better locations [39] Question: Will the trend of increasing street stores in the restaurant business continue? - Yes, the trend will continue as street stores provide stable consumer traffic and better control over operating hours [44] Question: What can be expected in 2025 regarding restaurant openings? - Management anticipates 60 new restaurant openings in 2025 [48] Question: Any progress on increasing trading liquidity in shares? - Plans for a reverse merger to increase liquidity, with a focus on profitable operations and strong cash flows [52]

Core Viewpoint - GreenTree Hospitality Group Ltd. reported its unaudited financial results for the fourth quarter and fiscal year of 2024, highlighting significant challenges in both hotel and restaurant segments, with total revenues decreasing by 18.2% year-over-year to RMB304.5 million (US$41.7 million) and a net loss of RMB72.8 million (US$10.0 million) in Q4 2024. Financial Performance - Total revenues for the year were RMB1,343.4 million (US$184.1 million), a 17.4% year-over-year decrease [12][10]. - Adjusted net income for Q4 2024 was RMB77.3 million (US$10.6 million), up from RMB60.9 million in Q4 2023, indicating a 26.8% increase [29][30]. - Cash from operations increased year-over-year to RMB74.2 million (US$10.2 million) [37]. Hotel Segment - The hotel business generated revenues of RMB240.2 million (US$32.9 million) in Q4 2024, a 17.1% year-over-year decrease, primarily due to a 9.8% decrease in RevPAR and the closure of 12 leased and operated hotels [11][12]. - As of December 31, 2024, the company operated 4,425 hotels with 321,282 rooms, having opened 143 hotels during the year [8][10]. - The average daily room rate was RMB169, down 4.6% from RMB177 in Q4 2023, with an occupancy rate of 68.6%, down from 72.4% [8]. Restaurant Segment - Restaurant revenues were RMB65.1 million (US$8.9 million) in Q4 2024, a 25.8% year-over-year decrease, attributed to the closure of leased and operated stores and a 16.8% decrease in average daily sales per store [12][14]. - The company had 182 restaurants in operation as of December 31, 2024, with franchised and managed stores accounting for almost 90% of all stores, up from 78% a year ago [5][48]. Operating Costs and Expenses - Total operating costs and expenses for Q4 2024 were RMB412.4 million (US$56.5 million), reflecting a significant increase in impairment losses related to the restaurant business [19][20]. - Operating costs for the hotel business decreased by 9.5% year-over-year to RMB139.9 million (US$19.2 million) [20]. - Selling and marketing expenses increased by 58.9% year-over-year to RMB17.6 million (US$2.4 million) [21]. Strategic Initiatives - The company plans to open 480 new hotels in 2025 while focusing on upgrading existing properties to enhance service quality [4]. - The strategic transformation of the restaurant business is ongoing, with a focus on increasing the number of franchised and managed stores [5]. Guidance - The company expects total revenues from its organic hotel business to remain flat compared to 2024 levels, reflecting a cautious outlook amid ongoing industry fluctuations [39].

Core Viewpoint - GreenTree Hospitality Group Ltd. will report its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2024, on April 24, 2025, with a conference call scheduled for the same day [1]. Company Overview - GreenTree Hospitality Group Ltd. is a leading hospitality management group in China, with a total of 4,336 hotels and 182 restaurants as of September 30, 2024 [3]. - In 2023, GreenTree was ranked 11th among the 225 largest global hotel groups by HOTELS magazine based on the number of hotels [3]. - The company was recognized as the fourth largest hospitality company in China in 2023 by the China Hospitality Association [3]. - GreenTree completed the acquisition of Da Niang Dumplings and Bellagio, two prominent restaurant chains in China, in 2023 [3]. Business Model and Strategy - GreenTree has a diverse brand portfolio that spans economy, mid-scale, and upscale segments of the hospitality industry, primarily in China [4]. - The company leverages a strong membership base, expansive booking network, and superior system management to maintain close relationships with clients and partners [4].

Group 1 - Global Hemp Group Inc. is suspended effective immediately under CSE Policy 3, categorized as a Regulatory Halt as per National Instrument 23-101 Trading Rules [1][2] - A cease trade order has been issued by the British Columbia Securities Commissions [1][2] - For further information regarding cease trade orders, the Canadian Securities Administrators provide a dedicated database [3]

Financial Data and Key Metrics Changes - Total revenues decreased by 22.5% year-over-year to RMB 357 million [11] - Net income decreased by 44.4% to RMB 65.2 million, with a margin of 18.3% [11][26] - Adjusted EBITDA decreased by 32.1% to RMB 122.5 million, with a margin of 34.3% [11] Business Line Data and Key Metrics Changes - Hotel revenues decreased by 15.4% to RMB 286.9 million, primarily due to a 13.6% decrease in RevPAR [11][19] - Restaurant business revenues decreased by 42% year-over-year to RMB 70.6 million, mainly due to lower ADS and the closure of L&O stores [24] - The number of restaurants in operation stabilized at 182, with 55.5% of stores now being franchise stores [10] Market Data and Key Metrics Changes - Hotel RevPAR was RMB 135, a decrease of 13.6% year-over-year [11] - Restaurant ADS decreased by 25.6% to RMB 4,891 [11] - Occupancy rates for L&O hotels decreased to 75.9% from 79%, while F&M hotels decreased to 74.6% from 81.3% [12] Company Strategy and Development Direction - The company is focusing on expanding its mid- to upscale segment and increasing its presence in Tier 2 and Tier 3 cities, especially in South China [14][15] - The strategic transformation of the restaurant business has been completed, with a focus on areas with greater foot traffic [17] - The company aims to improve profitability by enhancing the performance of legacy hotels and expanding its pipeline of new hotels [40] Management's Comments on Operating Environment and Future Outlook - Management noted a normalization in the hospitality industry following a surge last year, with expectations for improved performance in Q4 compared to Q3 [35] - The company is optimistic about its 2025 outlook, anticipating better performance driven by new hotel openings and improved RevPAR [40] - Management expressed confidence in maintaining the dividend policy despite the drop in net income, attributing part of the decline to a foreign exchange loss [54] Other Important Information - As of September 30, 2024, total cash and cash equivalents increased to RMB 1,883.9 million from RMB 1,737.2 million as of June 30, 2024 [27] - The company anticipates an 8% decrease in hotel revenue for the full year 2024 compared to 2023 [28] Q&A Session Summary Question: Industry trend and company performance comparison - Management indicated that their portfolio has a higher percentage of legacy hotels, which has resulted in a more severe impact on RevPAR compared to newly opened hotels [34] Question: Expectations for restaurant business in Q4 - Management expressed optimism about continued profitability in the restaurant segment, focusing on selecting new locations to sustain growth [36] Question: Sector supply and demand landscape - Management noted intensified competition in the industry but expects a more normalized environment moving forward, with many new hotels in the pipeline [39] Question: Bargaining power with OTAs - Management acknowledged the growth of OTAs and emphasized the importance of working closely with them to create mutually beneficial arrangements [46] Question: Guizhou project details - Management confirmed collaboration with local government on a project in Guizhou, aiming to reposition and reopen nonperforming assets [48] Question: Future dividend plans - Management reassured that the dividend policy will continue despite the drop in net income, citing confidence in future operating income improvements [54] Question: Liquidity improvement plans - Management discussed ongoing reorganization efforts to boost liquidity, including merging the parent company with GHG [55]