#China #Shanghai #financial results #GreenTree #Hospitality Group

GreenTree Hospitality Group Reports Financial Results for 2025

GreenTree Hospitality Group Ltd. (NYSE: GHG), a prominent player in China’s hospitality and restaurant sectors, recently unveiled its unaudited financial outcomes for the fourth quarter and full fiscal year 2025, revealing significant declines across various metrics.

Financial Summary

For the fourth quarter, GreenTree noted a stark revenue drop of 24.9% year-over-year, totaling RMB 228.7 million (approximately USD 32.7 million). This decline was further manifested in a net loss of RMB 55.7 million (USD 8.0 million), which, while still negative, was an improvement from the loss of RMB 72.8 million experienced during the same period in 2024.

The company’s core net income measured RMB 63.2 million (USD 9.0 million), an increase from RMB 57.8 million year-over-year, indicating some operational resilience despite the overall revenue downturn.

Operational Highlights

Hotel Performance
As of December 31, 2025, GreenTree operated 4,580 hotels with an inventory of 327,060 rooms. The company opened 76 new properties, and has 1,260 additional hotels contracted or in development. However, the average daily room rate fell to RMB 162, down from RMB 169 a year prior. The occupancy rate also dropped to 64.7% from 68.6% in 2024, showcasing a challenging environment.

Revenue per available room (RevPAR) plummeted by 9.5%, signifying heightened challenges in attracting guests amid competitive pressures.

Restaurant Operations
The group managed 191 restaurants by the end of 2025, a slight increase, but faced a 39.9% decrease in restaurant revenues to RMB 39.1 million (USD 5.6 million). This downturn was primarily due to a notable 21.8% decline in average daily sales per restaurant and a reduction in the number of operating stores.

Full-Year Results

For the entirety of 2025, total revenues reached RMB 1,097.4 million (approximately USD 156.9 million), an 18.3% decrease compared to the previous year. This included hotel revenues which accounted for RMB 912.3 million (USD 130.5 million) and restaurant revenues totaling RMB 186.2 million (USD 26.6 million), further emphasizing the operational difficulties faced by GreenTree.

Factors Influencing Performance

1. Operational Challenges: The closures of 15 leased and owned hotels due to lease expirations hurt revenue flows and occupancy rates.
2. Market Environment: The broader economic context, marked by shifts in consumer preferences and spending habits post-pandemic, adversely impacted both the hospitality and restaurant sectors.
3. Strategic Reviews: Ongoing reassessments of existing leases and properties have been a focal point for management as they endeavor to stabilize operations.

Looking Ahead

Despite the adverse results, GreenTree expects that organic hotel business revenues for 2026 may remain flat compared to 2025. This outlook reflects the management’s cautious optimism surrounding gradual recovery and adaptation to new market conditions.

As part of their operations, GreenTree emphasizes the need for effective financial metrics. Adjusted EBITDA for the fourth quarter reached RMB 41.9 million (US$ 6.0 million), while core net income for the year was reported at RMB 211.2 million (US$ 30.2 million), reflecting the ongoing changes and strategies in this evolving economic landscape.

Conclusion

The 2025 financial results of GreenTree Hospitality Group portray an organization in transition. While the numbers indicate challenges, the company's proactive measures in addressing operational setbacks and their optimistic guidance could pave the way for a more stable future. Investors and stakeholders will undoubtedly view the upcoming quarters closely as GreenTree navigates the road ahead.