GreenTree Hospitality Group Ltd. (NYSE:GHG) Q4 2021 Earnings Conference Call May 12, 2022 9:00 AM ET Company Participants Rene Vanguestaine - IR Alex S. Xu - Chairman and CEO Megan Huang - VP, Sales and Marketing Yiping Yang - CFO Conference Call Participants Dan Xu - Morgan Stanley Simon Cheung - Goldman Sachs Billy Ng - Bank of America/Merrill Lynch Don Lau - China Renaissance Securities Unidentified Analyst - UBS Operator Good morning, good afternoon, and good evening, and welcome to the GreenTree Hospit ...

Financial Data and Key Metrics Changes - Total revenues increased by 16.3% year-over-year to RMB310.4 million [18] - Income from operations decreased by 45.6% to RMB54.9 million, with a margin of 17.7% [20] - Net income decreased by 61.5% to RMB33 million, with a margin of 10.6% [20] - Non-GAAP adjusted EBITDA decreased by 33.5% to RMB73.7 million, with a margin of 23.7% [20] - Earnings per share decreased by 59.3% to RMB0.33 [21] Business Line Data and Key Metrics Changes - The company opened 182 new hotels in Q3 2021, less than planned due to COVID-19 impacts [14] - At the end of Q3 2021, the company had 4,626 hotels in operation, a 10.3% increase year-over-year [15] - The mid-scale segment accounted for 62.9% of all hotels, while mid to upscale and luxury hotels accounted for 11.2% of the total portfolio [15] Market Data and Key Metrics Changes - RevPAR decreased by 1.4% to RMB118 compared to Q3 2020 [8] - Occupancy rates recovered to 84.3% of their 2019 level, outperforming the industry average [9] - RevPAR for leased and operating (LO) hotels increased to RMB146, while RevPAR for franchisee-managed (FM) hotels decreased to RMB117 [17] Company Strategy and Development Direction - The company is expanding its hotel network in the mid to upscale segment and into Tier 3 and lower cities [11] - 68.7% of new hotels in the current pipeline are located in Tier 3 and lower cities [12] - The company aims to optimize its management and operating systems to improve hotel quality and performance [12] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current pandemic wave due to their resilient business model and experienced team [12] - The company expects total revenues for the full year of 2021 to grow by 25% to 30% over 2020 levels and by 7% to 12% over 2019 levels [22] Other Important Information - Total hotel operating costs increased by 48.3% year-over-year to RMB258.8 million, primarily due to the opening of new LO hotels [18] - The company closed 98 hotels in Q3 2021, with 59 closures due to noncompliance with brand standards [16] Q&A Session Summary Question: Hotel pipeline and opening expectations - Management expects to open about 700 to 800 hotels next year, despite a slower pace of openings due to COVID-19 impacts and higher requirements for hotel openings [24][25] Question: Future hotel closures - Management indicated that the closure rate will likely not exceed the levels experienced in 2021, as they aim to stabilize RevPAR [27][30] Question: Expansion of LO hotels - Management does not plan to significantly increase the number of LO hotels unless opportunities arise in areas with weak presence [31][32] Question: Margin trends and loss-making hotels - Newly opened hotels contributed a loss of RMB32 million, impacting margins; excluding these, EBITDA margin would increase to 38.5% [36]

GreenTree Hospitality Group Ltd. (NYSE:GHG) Q2 2021 Earnings Conference Call November 15, 2021 8:00 PM ET Company Participants Rene Vanguestaine - Christensen, Investor Relations Alex Xu - Founder, Chairman & Chief Executive Officer Megan Huang - Director of IT Department Selina Yang - Chief Financial Officer Conference Call Participants Billy Ng - Bank of America Yogesh Modak - ClearBridge Dan Xu - Morgan Stanley Operator Hello, ladies and gentlemen and thank you for standing by for GreenTree's Second Quar ...

Financial Data and Key Metrics Changes - RevPAR increased by 35.1% to RMB95.5 compared to Q1 2020, while total revenues rose by 53.3% to RMB241.2 million [8][9] - Income from operations increased by 64.9% to RMB61.4 million, with a margin of 25.4%. Net income turned positive at RMB66 million, with a margin of 27.4% [9][22] - Non-GAAP adjusted EBITDA increased by 74.3% to RMB64 million, with a margin of 26.5% [9][22] - Core net income, non-GAAP, increased by 58.3% to RMB43.9 million, with a margin of 18.2% [9][22] Business Line Data and Key Metrics Changes - Total revenue from F&M hotels increased by 51.2% to RMB177.9 million, while revenue from L&O hotels increased by 66% to RMB56.1 million [21] - The occupancy rate increased by 16.1% to 63.4%, and blended ADR increased by 0.8% to RMB151 [15][16] Market Data and Key Metrics Changes - The company opened 201 new hotels in Q1 2021, compared to 62 in Q1 2020, with a net addition of 124 hotels after closures [17] - 67.3% of the company's hotels are located in tier three and lower cities, which have shown faster recovery during the pandemic [16][13] Company Strategy and Development Direction - The growth strategy focuses on adding L&O hotels in strategic locations, expanding in tier three and lower cities, and penetrating the mid to upscale segment [12][13] - The company plans to open more hotels in the mid to upscale and luxury segments, with 68.5% of new hotels in tier three and lower cities [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about travel recovery as vaccine rollouts accelerate, expecting total revenues for 2021 to grow by 48% to 53% over 2020 levels [24] - The company is prepared for potential COVID-19 resurgences and has implemented measures to mitigate impacts on operations [42][44] Other Important Information - As of March 31, 2021, the company had total cash and cash equivalents of RMB1.7 billion, down from RMB1.9 billion at the end of 2020 [23] - The company expects to open around 700 to 800 new hotels in 2021, with a significant portion being franchised and managed hotels [48] Q&A Session Summary Question: Current outlook on RevPAR and reasons for delayed results - Management indicated that RevPAR was about 75% of pre-COVID levels in Q1, but increased to 100% in April, with rapid recovery expected [26] Question: Competition in lower tier cities - Management acknowledged increased competition but emphasized their accumulated experience and resources as competitive advantages [28][29] Question: Details on leased-and-operated hotels and their profitability - Management shared that L&O hotels had a RevPAR decrease of 20% compared to Q1 2019, but performance is expected to improve as more hotels are added [34] Question: Impact of recent floods and COVID resurgence - Management reported minimal impact from the floods and stated that COVID management measures are in place to mitigate risks [42][44] Question: Shareholder returns and debt considerations - Management noted that they are considering shareholder returns and will discuss options with the board [58][59]