Super Hi International Holding (9658) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue reached $198.6 million, up 14.6% year-over-year, with 7.4 million customers served, a 4.2% increase, and net profit of $38.0 million compared to a prior loss.

• Operating profit margin improved to 7.5%, up from 5.7% year-over-year, with operational improvements in management efficiency and customer experience.

• No new stores opened in Q3 due to construction, but nine new stores opened year-to-date; restaurant footprint stable at 121 locations.

• Expansion strategies included increasing restaurant density, exploring new markets, and balancing quality and quantity.

• Enhanced management practices and continued innovation in marketing and menu, including successful product launches and collaborations.

Financial highlights

• Restaurant operations revenue grew 14.5% year-over-year to $190.9 million; delivery business rose 8.3% to $2.6 million; other income increased 21.4% to $5.1 million.

• Operating profit for Q3 was $14.9 million, with net profit after tax at $38.0 million and net profit margin at 19.0%.

• Gross profit margin improved due to optimized raw material use and reduced rental and utility expenses.

• Staff costs rose 15.2% to $65.8 million, representing 33.1% of revenue; employee costs increased due to staffing and minimum wage hikes.

• Operating cash flow increased to $40.7 million from $19.9 million year-over-year.

Outlook and guidance

• Double-digit new store openings expected for 2024, with over 10 projects contracted; focus on enhancing dining experiences, digital management, and supply chain optimization.

• Maintaining mid-single digit operating profit margin guidance for the year; aiming for 10%-15% store-level margin in 2025.

• Q4 table turnover rate expected to improve year-over-year, with stable average spending per customer.