HAIDILAO(06862)2025-03-31 02:41Summary of Haidilao International Conference Call Company Overview - Company: Haidilao International - Industry: Restaurants - Market Cap: HK12.6 billion - Shares Outstanding: 5,574 million - Listing: Listed on the Hong Kong Stock Exchange since September 2018 Key Financial Highlights - 2024 Revenue: Rmb42.8 billion, up 3% YoY - 2024 Net Profit: Rmb4,708 million, up 5% YoY - H2 2024 Revenue: Rmb21.3 billion, down 6% YoY - H2 2024 Net Profit: Rmb2,670 million, down 19% YoY - H2 2024 Net Margin: 12.5%, highest since 2018 - Dividend Payout Ratio: 95% in 2024 Performance Analysis - Gross Profit Margin (GPM): 63.2% in H224, up 4.2 percentage points YoY - SG&A Ratio: 48.4%, 1.6 percentage points above expectations due to higher labor and rental costs - Average Table Turn: Improved to 4.1x per day in 2024, down from 4.3x in H2 2023 - Average Spending per Customer: Rmb97.5 in 2024, slightly down from Rmb99.1 in 2023 Store Network and Strategy - New Openings: 62 units opened (59 self-operated, 3 franchised) and 70 units closed in 2024 - Franchise Strategy: 70% of franchise applications from tier-3 and below cities - Multi-brand Strategy: Operates 74 stores under 11 small brands, with over 40 Yanqing Barbeque restaurants averaging Rmb0.8 million sales per store per month Future Outlook - Store Opening Guidance: Management maintains guidance to open a mid-single-digit percentage of new Haidilao stores in 2025, with contracts signed for 41 new stores as of February 2025 - Price Target: Raised to HK19.35, with a "Buy" rating Risks and Considerations - Key Risks: - Deteriorating macroeconomic factors affecting consumer spending - Rising commodity and labor costs - Food safety incidents - Downside Risks: - Cannibalization among restaurants due to aggressive expansion - Competition from local hotpot restaurants and supermarkets - Challenges in adapting to delivery and takeaway services Valuation Metrics - P/BV (12/25E): 8.0x - Forecast Stock Return: 22.8% - Forecast Dividend Yield: 5.6% Conclusion Haidilao International shows a mixed performance with a solid revenue increase but challenges in net profit and store openings. The company is focusing on a multi-brand strategy and expanding its franchise network while managing costs and risks associated with the restaurant industry. The raised price target reflects a positive outlook despite the challenges ahead.