TH International Limited (THCH) Q3 2024 Earnings Call Transcript
Adjusted Corporate EBITDA Achieved adjusted corporate EBITDA profitability again in Q3 2024, maintaining profitability after achieving first-ever adjusted corporate EBITDA profitability in Q2 2024.
Company-Owned Store Contribution Margin Achieved highest-ever quarterly company-owned and operated store contribution margin of 13.3%, a year-over-year margin expansion of 5.8 percentage points, due to improvements in operational efficiencies and supply chain capabilities.
Monthly Average Transacting Customers Reached 3.3 million in Q3 2024, a 2.4% increase from 3.2 million in Q3 2023, indicating growth in customer engagement.
Digital Orders Percentage Increased from 82.6% in Q3 2023 to 86.6% in Q3 2024, reflecting enhanced digital capabilities to meet demand for delivery and takeaway services.
Food and Packaging Costs as Percentage of Revenues Reduced by 6.1 percentage points year-over-year, contributing to improved margins through better supply chain management and economies of scale.
Labor Costs as Percentage of Revenues Reduced by 3.0 percentage points year-over-year, indicating improved operational efficiency.
Marketing Expenses as Percentage of Total Revenues Decreased by 2.3 percentage points year-over-year, reflecting cost optimization measures and increased brand recognition.
General and Administrative Expenses as Percentage of Total Revenues Reduced by 2.7 percentage points year-over-year, resulting from streamlined headquarter costs.
Total Cash and Cash Equivalents As of September 30, 2024, total cash and cash equivalents were RMB203.7 million (US$29.1 million), down from RMB219.5 million as of December 31, 2023, primarily due to cash disbursements for business expansion and repayment of bank borrowings.
Loyalty Club Members Reached 22.8 million, reflecting a 35.3% year-over-year growth, indicating strong customer engagement and support for loyalty programs.
Chibaobao Cards Sold Sold over 120,000 cards in Q3 2024, driving a 4.6 times increase in purchase frequency among card purchasers compared to non-purchasers.
CapEx for Typical Store CapEx for a typical store is around RMB450,000 to RMB500,000 (approximately US$70,000), with a payback period of 2 to 3 years, indicating attractive unit economics.
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TH International Shares Surge 8.7%, Leading Grocery & Drug Stores Sector
- Stock Performance: TH International's shares rose approximately 8.7% on Wednesday, positioning the company as a leader in the grocery and drug stores sector, indicating positive market sentiment regarding its business outlook.
- Industry Trends: The overall grocery and drug stores sector saw a collective increase of about 0.4%, reflecting consumer demand stability and industry resilience, which may attract more investor interest in this sector.
- Competitor Dynamics: Dine Brands Global also experienced a share increase of about 2.1%, further indicating that companies within this industry are gaining market recognition, potentially fostering competition and collaboration among peers.
- Market Impact: These stock price increases may encourage other related companies to adopt proactive market strategies, thereby driving growth and innovation across the grocery and drug stores industry.
TH International Reports 12.8% YoY Sales Growth to RMB 419.9 Million in Q3 2025
- Sales Growth: TH International's system sales increased by 12.8% year-over-year to RMB 419.9 million in Q3 2025, indicating a strong recovery in the Chinese market and enhancing its competitive position.
- Same-Store Sales: The same-store sales growth for company-owned stores was positive at 3.3%, reflecting strong consumer response to the newly launched 'Light & Fit Lunch Box' products, which boosted overall sales performance.
- Membership Growth: As of September 30, 2025, registered loyalty club members reached 27.9 million, representing a 22.3% year-over-year increase, laying a solid foundation for future customer loyalty and sales growth.
- Financial Performance: Despite a slight revenue decline of 0.4% to RMB 358 million, other revenues surged by 25% to RMB 75.1 million, showcasing the company's success in diversifying its revenue streams.
