GreenTree Hospitality Reports Surging Revenue in Fourth Quarter, Higher Profits
GreenTree Hospitality Group Ltd. (Nasdaq: GHG) reported today that revenue in the fourth quarter surged 21 percent year-over-year while the company moved into profitability compared with a year earlier.
With headquarters in Shanghai, GreenTree said it had net income attributable to shareholders of $7.8 million in the three months through Dec. 31, equal to 8 cents per American depositary share. The company reported a net loss of $1.4 million, or 2 cents per ADS, a year earlier.
Revenue for the period climbed to $36.3 million from $30.1 million in the final quarter of 2017.
"We remain committed to a steady and stable growth strategy as we explore the growing consumption trends in the second and third tier cities and expand our geographical coverage across China, covering 290 cities at the end of December 2018," said Alex Xu, the company's chairman and chief executive officer.
"We are investing in select companies to develop strong partnerships that will enhance each other resources, particularly technology and talents, in order to create more value for our customers and franchisees," he said.
With 2,757 hotels at year-end, representing a 20 percent increase from a year earlier, GreenTree operates 99 percent of its properties as franchised-and-managed in 290 cities in China.
The company has been pursuing a strategy of acquisitions and investments recently as a means of expansion throughout China.
So far this year, GreenTree has invested in China Gingko Education Group Co. Ltd., a Hong Kong-listed hospitality university, to partner in developing professional talent for the hotel industry.
The company also made a major investment in Argyle Hotel Management Group (Australia) Pty. Ltd., which controls hotels in China and Southeast Asia, as well as in Zhejiang New Century Hotel Management Co. Ltd, which operates and manages 150 hotels in China.
For the full year 2019, the company said it expects revenue growth of 20 to 25 percent compared with last year.
Shares in GreenTree closed down slightly today at $12.77 per ADS, off 3 cents.