#China #Shanghai #financial results #revenue decline #GreenTree Hospitality

GreenTree Hospitality Group Reports Financial Results for H1 2025

GreenTree Hospitality Group Ltd. has recently disclosed its unaudited financial results for the first half of 2025, revealing significant challenges in its revenue streams. The company, a prominent player in China's hospitality and restaurant management sectors, recorded a considerable decline in overall revenues compared to the previous year.

Financial Overview

Total revenues for the first half of 2025 amounted to RMB 585.1 million (approximately US$81.7 million), reflecting a 14.2% decrease from the same period in 2024. Income from operations was reported at RMB 91.5 million (US$12.8 million), a sharp decline from RMB 156.7 million in the first half of last year. This trend was also evident in the adjusted EBITDA, which experienced a significant drop of 22.2% year-over-year to RMB 149.7 million (US$20.9 million).

Particularly noteworthy is the company’s net income, which increased to RMB 198.8 million (US$27.7 million), up from RMB 119.6 million in the prior half. This increase is largely attributed to gains from investment activities and effective cost management underlying the operational losses in core business segments.

Hotel Operations

As of June 30, 2025, GreenTree had 4,509 hotels operating with a total of 321,977 rooms. However, the hotel segment faced a sharp decline in average daily room rates, which dropped to RMB 157 in Q1 2025, down 6.9% year-over-year. The company reported occupancy rates of 64.0% in Q1 and 67.9% in Q2 of 2025, lower than those recorded in the equivalent quarters of the previous year. Revenue per available room (RevPAR) also declined, indicating challenges in the hotel division.

The company opened 138 new hotels during this period, with an additional 1,245 hotels in the pipeline, signifying ongoing efforts to expand its footprint despite prevailing market conditions.

Restaurant Operations

In the restaurant division, which includes 183 operated sites, total revenue fell to RMB 97.7 million (US$13.6 million), a staggering 31.6% year-over-year decreas. The reduced average check amounts and fewer daily tickets attributed to the drop in sales, pushing the average daily sales per restaurant significantly lower.

Operating costs in the hospitality sector evaluated at RMB 370.3 million (US$51.7 million) showed a year-over-year decrease, as the management team focused on reducing expenses while adjusting their full business strategy in light of the current market environment.

Looking Ahead

In response to these financial outcomes, GreenTree's management has provided updated guidance for the hotel sector, indicating anticipated revenue declines of between 10% and 13%. This forecast reflects the company's cautious approach in navigating through the competitive landscape marked by fluctuating demand and operational setbacks.

Additionally, the company announced a cash dividend of US$0.06 per ordinary share, payable to shareholders recorded by the close of trading on October 31, 2025. This decision reflects GreenTree's commitment to deliver shareholder value amid broader operational challenges.

Conclusion

In summary, while GreenTree Hospitality Group Ltd. has faced a notable decline in revenues and operational performance in the first half of 2025, strategic expansions and adjustments may position the company to navigate through its current challenges. The increase in net income from investment activities demonstrates resilience, and ongoing management efforts will be key to steering through the evolving hospitality landscape in the upcoming months.