GreenTree(GHG)2021-07-31 12:22Financial 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]