HAIDILAO(HK:06862)2026-01-06 02:23Summary of Haidilao International Holding (6862.HK) Conference Call Company Overview - Company: Haidilao International Holding - Industry: Consumer & Leisure, specifically in the restaurant sector Key Points Recent Updates - Table Turn: Remained flat year-over-year (yoy) in December and for the second half of 2025 [1] - Revenue Impact: Conversion of direct-operated stores to franchise stores, net closures, and smaller party sizes per table led to a slight dip in restaurant revenue. However, overall group revenue in 2025 is expected to be supported by strong growth in delivery and other brands' revenue [1][10] - Store Count: Approximately 1,300 stores in 2025, indicating a net decrease compared to 2024 [10] - Pricing: Remained largely flat yoy in 2025, with table turnover also flat in December and the second half of 2025 [10] Financial Projections - Gross Margin: Expected to improve in the second half of 2025 compared to the first half, with stable labor costs and expense ratios [10] - Store Openings: Projected gross openings of stores to increase by mid-single digits percentage (MSD%) yoy in 2026, with a potential slowdown in franchise store expansion [10] - Cost Savings: Anticipated from automation and depreciation & amortization (D&A) reductions, with several hundred million expected in savings for 2026 and 2027 [10] Strategic Initiatives - Multi-Brand Strategy: Shifted to a top-down approach, focusing on Haidilao seafood street stall and Ru Sushi in 2026. The goal is to incubate 1-3 brands with over 500 stores within three years [1][10] - Performance of Other Brands: Yanqing underperformed due to subdued demand and competition, while Miaoshixiong and Ju Gao Gao showed healthy performance [10] Payout Ratio - Dividend Policy: Aiming to maintain a high payout ratio of 90% in 2023 and 95% in 2024, though not yet finalized [1][11] Market Outlook - Price Target: Neutral rating with a 12-month target price of HK$14.70, based on a 9.5x 2026E EV/EBITDA [12] - Risks: Include variability in table turn recovery, expansion rates, performance of new business models, cost savings, and food safety issues [12] Financial Metrics (2025 Estimates) - Revenue: Rmb 42,630.9 million - EBITDA: Rmb 7,062.0 million - EPS: Rmb 0.69 - P/E Ratio: 18.5x - Dividend Yield: 5.1% [13] Additional Insights - Competition Landscape: Management noted the emergence of segmented hotpot categories and a strong demand for value-for-money food services [9] - Store Expansion Strategy: Management does not expect aggressive store expansion in the next 2-3 years, indicating a cautious approach to growth [10] This summary encapsulates the key takeaways from the conference call, highlighting the company's current performance, strategic direction, and market outlook.