Summary of DTC Dash Limited Full Year 2024 Earnings Conference Call Company Overview - **Company**: DTC Dash Limited - **Industry**: Fast Food / Pizza Franchise - **Franchisee**: Exclusive master franchisee of Domino's Pizza in mainland China, Hong Kong, and Macau - **Global Franchisor**: Domino's Pizza Inc. with over 21,300 stores in more than 90 markets as of December 31, 2024 [2][3] Key Financial Highlights - **Total Revenues**: RMB 4.3 billion, a 41.4% increase from RMB 3.1 billion in 2023 [3][8] - **Average Daily Sales per Store**: Increased by 4.3% to RMB 13,126 from RMB 12,580 in 2023 [3][8] - **Same-Store Sales Growth (SSG)**: Achieved 2.5% in 2024, following 8.9% in 2023, marking the 30th consecutive quarter of positive sales [3][4] - **Store Network Expansion**: Expanded to 1,008 stores with a net addition of 240 stores in 2024 [3][4] - **Store-Level Operating Profit Margin**: Increased to 14.5% from 13.8% in 2023, with store-level operating profit reaching RMB 624 million, a 48.7% increase [4][12] - **Adjusted EBITDA**: Rose to RMB 495.2 million, a 64.1% increase from RMB 301.7 million in 2023 [4][12] - **Adjusted Net Profit**: Reached RMB 131.2 million, up from RMB 8.8 million in 2023 [4][12] - **Reported Net Profit**: Positive at RMB 55.2 million compared to a net loss of RMB 26.6 million in 2023 [4][12] Strategic Insights - **4D Strategy**: Focus on Development, Delicious Pizza Value, Delivery, and Digital [3][4] - **Expansion Strategy**: Balanced approach of deepening presence in existing markets while entering new cities; entered six new cities in January 2025 [4][5] - **Revenue Mix**: New growth markets contributed 61.8% of total revenue, up from 49.4% in 2023, with revenue from these markets increasing by 77% [5][6] - **Menu Development**: Introduced over 30 pizza varieties and approximately 20 crust options, with pizza products accounting for more than 75% of total sales [6][7] Operational Highlights - **Delivery Services**: Delivery percentage decreased from 59.2% in 2023 to 46.1% in 2024 due to high dine-in and carry-out volumes in new markets [6][7] - **Loyalty Program**: Membership increased from 14.6 million to 24.5 million, with revenue from loyalty members growing from 59.2% to 64.5% of total sales [7][8] - **Capital Expenditure**: Anticipated at approximately RMB 570 million for 2025, funded through existing cash reserves [7][8] Market Position and Competition - **Market Ranking**: Ranked second nationally in China based on 2024 pizza sales [3][4] - **Competitive Landscape**: Addressing competition from Pizza Hut and other QSR brands by focusing on product quality and service rather than solely on pricing [19][20] Future Outlook - **Store Opening Plans**: Plans to open about 300 stores in 2025, with a focus on operational excellence and service quality [7][8] - **Market Dynamics**: The company remains confident in its business model despite global uncertainties, aiming for sustainable growth and long-term shareholder value [7][8] Additional Insights - **Cost Management**: Raw materials and consumables cost increased by 39.8%, but the ratio to revenue improved from 27.4% in 2023 to 27.1% in 2024 [9][10] - **Staff Compensation**: Total staff compensation expenses increased by 28.1% to RMB 1.51 billion, with a focus on hiring for new store openings [10][11] This summary encapsulates the key points from the earnings call, highlighting the company's performance, strategic initiatives, and future outlook in the competitive fast-food industry.