Total Revenues Increased 67.9% to
46
Same-Store Sales Growth for Company Owned and Operated Stores of 7.5%
8.9 Million Registered Loyalty Club Members, Representing 85.8% Year-over-Year Growth
Adjusted Store EBITDA Margin Increased 4.
THIRD QUARTER 2022 HIGHLIGHTS
- Total revenues were
RMB305.7 million (USD43.0 million ) for the three months endedSeptember 30, 2022 , representing an increase of 67.9% fromRMB182.1 million in the same quarter of 2021. - Net new store openings totaled 46 (35 company owned and operated stores and 11 franchised stores) for the three months ended
September 30, 2022 . System-wide stores reached 486 (454 company owned and operated stores and 32 franchised stores) as ofSeptember 30, 2022 , compared to 440 as ofJune 30, 2022 and 280 as ofSeptember 30, 2021 . - Same-store sales growth for company owned and operated stores was 7.5% for the three months ended
September 30, 2022 , compared to 6.6% in the same quarter of 2021. - Registered loyalty club members totaled 8.9 million as of
September 30, 2022 , representing an 85.8% increase from 4.8 million as ofSeptember 30, 2021 . - Adjusted store EBITDA(1), was
RMB19.4 million (USD2.7 million ) for the three months endedSeptember 30, 2022 , representing a 336.6% increase fromRMB4.4 million in the same quarter of 2021. - Adjusted store EBITDA margin, which stands for adjusted store EBITDA as a percentage of our revenues from company owned and operated stores, was 6.7% for the three months ended
September 30, 2022 , representing an increase of 4.1 percentage points from 2.6% in the same quarter of 2021.
(1) Adjusted store EBITDA is calculated as fully-burdened gross profit(2) of company owned and operated stores excluding depreciation & amortization and store pre-opening expenses.
(2) Fully-burdened gross profit of company owned and operated stores, the most comparable GAAP measure to adjusted store EBITDA, was a loss of
COMPANY MANAGEMENT STATEMENT
Mr.
Mr.
IMPACT OF COVID-19 AND MITIGATION EFFORTS
We have demonstrated our resilience and agility throughout the COVID-19 pandemic, but serious challenges remain. The COVID-19 pandemic continued to adversely affect our store operations and the sales of affected cities, primarily as a result of temporary store closures, reduced operating hours, disallowed dine-in services, decreased customer traffic, and disruptions to the supply chain and logistics. In the third quarter of 2022, the Company experienced approximately 23 daily temporary store closures on average, compared to approximately 138 daily temporary store closures on average in the second quarter. Entering the fourth quarter, new infections continued to increase in October and November with resurgent outbreaks across China. The Company experienced approximately 36 daily temporary store closures on average in October.
Despite the volatile environment, the Company grew total revenues year-over-year by 67.9% and achieved same-store sales growth for company owned and operated stores of 7.5% during the third quarter of 2022. We captured the growing demand for delivery and takeaway services, and the number of home-delivery orders fulfilled increased by 111.1% from the third quarter of 2021 to the third quarter of 2022.
Due to the uncertainty of the development of the COVID-19 pandemic, it remains difficult to predict the full impact of the COVID-19 pandemic on the broader economy and the actions and measures undertaken by government authorities to contain the COVID-19 pandemic, which may impose continuing adverse effects on our results of operations, cash flows and financial position going forward.
THIRD QUARTER 2022 FINANCIAL RESULTS
Total revenues were
- Revenues from company owned and operated stores were
RMB290.0 million (USD40.8 million ) for the three months ended September 30, 2022, representing an increase of 67.0% fromRMB173.7 million in the same quarter of 2021. The growth was primarily driven by an increase in the number of company owned and operated stores from 268 as ofSeptember 30, 2021 to 454 as ofSeptember 30, 2022 and 7.5% same-store sales growth of company owned and operated stores for the three months endedSeptember 30, 2022 . - Other revenues were
RMB15.7 million (USD2.2 million ) for the three months endedSeptember 30, 2022 , representing an increase of 86.4% fromRMB8.4 million in the same quarter of 2021. The growth was primarily attributable to the rapid expansion of our e-commerce business and an increase in franchise fees and revenues from other franchise support activities, which was attributable to an increase in the number of franchised stores from 12 as ofSeptember 30, 2021 to 32 as ofSeptember 30, 2022 .
Company operated store costs and expenses were
- Food and packaging expenses were
RMB96.6 million (USD13.6 million ), representing an increase of 61.6% fromRMB59.8 million , in line with our revenue growth and store network expansion. Food and packaging costs as a percentage of revenues from company owned and operated stores decreased by 1.1 percentage points from 34.4% in the third quarter of 2021 to 33.3% in the third quarter of 2022. - Rental expenses were
RMB36.1 million (USD5.1 million ), representing a decrease of 15.7% fromRMB42.9 million , mainly due to rent concessions that we received during the third quarter of 2022. Rental expenses as a percentage of revenues from company owned and operated stores decreased by 12.2 percentage points from 24.7% in the third quarter of 2021 to 12.5% in the third quarter of 2022. - Payroll and employee benefitsexpenses were
RMB66.0 million (USD9.3 million ), representing an increase of 10.7% fromRMB59.6 million , primarily due to increased headcount of our store operation and managerial personnel. Payroll and employee benefits as a percentage of revenues from company owned and operated stores decreased by 11.5 percentage points from 34.3% in the third quarter of 2021 to 22.8% in the third quarter of 2022. - Delivery costs were
RMB23.6 million (USD3.3 million ), representing an increase of 110.2% fromRMB11.2 million , due to increased number of home-delivery orders fulfilled. Delivery costs as a percentage of revenues from company owned and operated stores increased by 1.6 percentage points from 6.5% in the third quarter of 2021 to 8.1% in the third quarter of 2022. - Other operating expenses were
RMB77.5 million (USD10.9 million ), representing an increase of 66.9% fromRMB46.5 million , in line with our revenue growth and store network expansion. Other operating expenses as a percentage of revenues from company owned and operated stores remained flat at 26.7% during the third quarter of 2022.
Cost of other revenues was
Marketing expenses were
General and administrative expenses were
Franchise and royalty expenses were
As a result of the foregoing, operating loss was
Adjusted Corporate EBITDA was a loss of
Net loss was
Basic and diluted net loss per ordinary share was
Liquidity
As of
KEY OPERATING AND FINANCIAL DATA
For the three months ended or as of | |||||||||||||
2021 | 2021 | 2021 | 2021 | 2022 | 2022 | 2022 | |||||||
Total stores | 159 | 217 | 280 | 390 | 424 | 440 | 486 | ||||||
Company owned and operated stores | 150 | 206 | 268 | 373 | 403 | 419 | 454 | ||||||
Franchised stores | 9 | 11 | 12 | 17 | 21 | 21 | 32 | ||||||
Same-store sales growth for system-wide stores | 41.6% | 26.5% | 6.5% | 8.2% | 4.4% | -6.1% | 8.1% | ||||||
Same-store sales growth for company owned and operated stores | 40.3% | 25.5% | 6.6% | 8.8% | 5.5% | -5.3% | 7.5% | ||||||
Registered loyalty club members (in thousands) | 2,947 | 3,865 | 4,770 | 5,969 | 6,907 | 7,532 | 8,862 | ||||||
Adjusted store EBITDA (Renminbi in thousands) | 3,271 | 5,296 | 4,432 | 14,468 | -21,050 | -40,279 | 19,352 | ||||||
Adjusted store EBITDA margin | 3.3% | 4.1% | 2.6% | 6.8% | -10.0% | -24.5% | 6.7% |
KEY DEFINITIONS
- Same-store sales growth. The percentage change in the sales of stores that have been operating for 12 months or longer during a certain period compared to the same period from the prior year. The same-store sales growth for any period of more than a month equals to the arithmetic average of the same-store sales growth of each month covered in the period. If a store was closed for seven days or more during any given month, its sales during that month and the same month in the comparison period are excluded for purposes of measuring same-store sales growth.
- Net new store openings. The gross number of new stores opened during the period minus the number of stores permanently closed during the period.
- Adjusted store EBITDA. Calculated as fully-burdened gross profit of company owned and operated stores excluding depreciation and amortization, and store pre-opening expenses.
- Adjusted store EBITDA margin. Calculated as adjusted store EBITDA as a percentage of revenues from company owned and operated stores.
- Adjusted general and administrative expenses. Calculated as general and administrative expenses excluding share-based compensation expenses, expenses related to the Commitment Shares, the ESA Offering Costs, and expenses related to the Option Shares.
- Adjusted corporate EBITDA. Calculated as operating loss excluding store pre-opening expenses, and certain non-cash expenses consisting of depreciation and amortization, share-based compensation expenses, expenses related to the Commitment Shares, the ESA Offering Costs, expenses related to the Option Shares, impairment losses of long-lived assets and loss on disposal of property and equipment.
- Adjusted corporate EBITDA margin. Calculated as adjusted corporate EBITDA as a percentage of total revenues.
- Adjusted net loss. Calculated as net loss excluding store pre-opening expenses, share-based compensation expenses, expenses related to the Commitment Shares, the ESA Offering Costs, expenses related to the Option Shares, impairment losses of long-lived assets, loss on disposal of property and equipment, changes in fair value of convertible notes, changes in fair value of warrant liabilities; and changes in fair value of
ESA derivative liabilities. - Adjusted net loss margin. Calculated as adjusted net loss as a percentage of total revenues.
- Adjusted basic and diluted net loss per ordinary share. Calculated as adjusted net loss attributable to the Company’s ordinary shareholders divided by weighted-average number of basic and diluted ordinary share.
RECENT BUSINESS DEVELOPMENTS
- On
August 1, 2022 ,Tims China announced the opening of threeTims China coffee shops conveniently located in Beijing’s central business district within Sinopec'sEasy Joy , China's largest convenience store chain. The newly openedTims China shops employ the new “Tims Express” format, a compact and efficient footprint that integrates easily intoEasy Joy stores and exhibits Tims China’s signature welcoming design. - On
September 7, 2022 ,Tims China announced the launch of two co-branded ready-to-drink (RTD) coffee products in partnership with Sinopec’sEasy Joy . - On
October 17, 2022 ,Tims China announced that it has opened its 500th coffee shop. The 500th store is located inDongguan , a city of over 10 million people on thePearl River delta, less than 50 miles fromHong Kong . This opening underscores Tims China’s acceleration into new cities across China. - On
November 18, 2022 ,Tims China announced a two-year partnership with Freshippo,Alibaba Group’s (NYSE: BABA) retail chain for groceries and fresh goods. The partners will introduce co-branded coffee products for sale exclusively through Freshippo’s online channels and over 300 brick-and-mortar stores located in 27 cities across China.Tims China and Freshippo will also work together on research and development of the co-branded products, collaborating on product design, positioning, promotion, and pricing.
About
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Without limiting the generality of the foregoing, the forward-looking statements in this press release include descriptions of the Company’s future commercial operations, such as the geographic expansion of its store network, the continued growth of its loyalty club members, its new product development capabilities, the benefits of its recent partnerships, its ability to successfully build a genuine community and grow customer recognition, brand awareness and loyalty, and the impact of COVID-19 and related government measures. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, such as the Company’s inability to implement its business plans, identify and realize additional opportunities, or meet or exceed its financial projections and changes in the regulatory or competitive environment in which the Company operates. You should carefully consider the foregoing factors and the other risks and uncertainties described in the Company’s registration statement on Form F-1, as amended, initially filed with the
Non-GAAP Financial Measures
The Company uses non-GAAP financial measures, namely adjusted store EBITDA, adjusted store EBITDA margin, adjusted general and administrative expenses, adjusted corporate EBITDA, adjusted corporate EBITDA margin, adjusted net loss, adjusted net loss margin, and adjusted basic and diluted net loss per ordinary share in evaluating its operating results and for financial and operational decision-making purposes. The Company defines (i) adjusted store EBITDA as fully-burdened gross profit of company owned and operated stores excluding depreciation and amortization, and store pre-opening expenses; (ii) adjusted store EBITDA margin as adjusted store EBITDA as a percentage of revenues from company owned and operated stores; (iii) adjusted general and administrative expenses as general and administrative expenses excluding share-based compensation expenses, expenses related to the Commitment Shares, the ESA Offering Costs, and expenses related to the Option Shares; (iv) adjusted corporate EBITDA as operating loss excluding store pre-opening expenses, and certain non-cash expenses. consisting of depreciation and amortization, share-based compensation expenses, expenses related to the Commitment Shares, the ESA Offering Costs, expenses related to the Option Shares, impairment losses of long-lived assets and loss on disposal of property and equipment; (v) adjusted corporate EBITDA margin as adjusted corporate EBITDA as a percentage of total revenues; (vi) adjusted net loss as net loss excluding store pre-opening expenses, share-based compensation expenses, expenses related to the Commitment Shares, the ESA Offering Costs, expenses related to the Option Shares, impairment losses of long-lived assets, loss on disposal of property and equipment, changes in fair value of convertible notes, changes in fair value of warrant liabilities; and changes in fair value of
These non-GAAP financial measures are not defined under
Exchange Rate
This press release contains translations of certain RMB amounts into
Contacts
Investor Relations
IR@timschina.com
TimsChinaIR@icrinc.com
Public Relations
TimsChinaPR@icrinc.com
TH INTERNATIONAL LIMITED AND SUBSIDIARIES | ||||||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
(Amounts in thousands of RMB and US$, except for number of shares) | ||||||||||
As of | ||||||||||
2021 | September 30,2022 (Unaudited) | |||||||||
RMB | RMB | US$ | ||||||||
ASSETS | ||||||||||
Current assets | ||||||||||
Cash | 390,837 | 382,448 | 53,764 | |||||||
Short term investment | - | 377,491 | 53,067 | |||||||
Accounts receivable | 9,817 | 7,672 | 1,079 | |||||||
Inventories | 42,479 | 52,180 | 7,335 | |||||||
Prepaid expenses and other current assets | 142,839 | 118,127 | 16,606 | |||||||
Total current assets | 585,972 | 937,918 | 131,851 | |||||||
Non-current assets | ||||||||||
Property and equipment, net | 554,015 | 636,618 | 89,494 | |||||||
Intangible assets, net | 77,594 | 86,180 | 12,115 | |||||||
Other non-current assets | 67,312 | 78,562 | 11,044 | |||||||
Total non-current assets | 698,921 | 801,360 | 112,653 | |||||||
Total assets | 1,284,893 | 1,739,278 | 244,504 | |||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
Current liabilities | ||||||||||
Short-term bank borrowings | 192,055 | 363,926 | 51,160 | |||||||
Accounts payable | 60,952 | 91,935 | 12,924 | |||||||
Contract liabilities | 14,129 | 29,350 | 4,126 | |||||||
Amount due to related parties | 14,074 | 14,855 | 2,088 | |||||||
Derivative financial liabilities | - | 157,900 | 22,197 | |||||||
Other current liabilities | 286,080 | 297,801 | 41,865 | |||||||
Total current liabilities | 567,290 | 955,767 | 134,360 | |||||||
Non-current liabilities | ||||||||||
Long-term bank borrowings | 11,903 | 8,501 | 1,195 | |||||||
Convertible notes, at fair value | 318,466 | 358,540 | 50,403 | |||||||
Contract liabilities - non-current | 970 | 1,319 | 185 | |||||||
Derivative financial liabilities - non-current | - | 55,378 | 7,785 | |||||||
Other non-current liabilities | 47,169 | 56,163 | 7,895 | |||||||
Total non-current liabilities | 378,508 | 479,901 | 67,463 | |||||||
Total liabilities | 945,798 | 1,435,668 | 201,823 | |||||||
Shareholders’ equity | ||||||||||
Ordinary Shares ( | 7 | 9 | 1 | |||||||
Additional paid-in capital | 937,315 | 1,450,352 | 203,887 | |||||||
Accumulated losses | (637,528 | ) | (1,156,306 | ) | (162,550 | ) | ||||
Accumulated other comprehensive income | 35,744 | 9,090 | 1,278 | |||||||
Total equity attributable to shareholders of the Company | 335,538 | 303,145 | 42,616 | |||||||
Non-controlling interests | 3,557 | 465 | 65 | |||||||
Total shareholders’ equity | 339,095 | 303,610 | 42,681 | |||||||
Commitments and Contingencies | - | - | - | |||||||
Total liabilities and shareholders’ equity | 1,284,893 | 1,739,278 | 244,504 | |||||||
TH INTERNATIONAL LIMITED AND SUBSIDIARIES | |||||||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS) | |||||||||||||||||||
(Amounts in thousands of RMB and US$, except for per share data) | |||||||||||||||||||
For the three months ended | For the nine months ended | ||||||||||||||||||
2021 | 2022 | 2021 | 2022 | ||||||||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||||||
Revenues | |||||||||||||||||||
Company owned and operated stores | 173,703 | 290,009 | 40,769 | 403,573 | 665,588 | 93,567 | |||||||||||||
Other revenues | 8,428 | 15,710 | 2,208 | 15,824 | 43,995 | 6,185 | |||||||||||||
Total revenues | 182,131 | 305,719 | 42,977 | 419,397 | 709,583 | 99,752 | |||||||||||||
Costs and expenses, net | |||||||||||||||||||
Company owned and operated stores | |||||||||||||||||||
Food and packaging (including cost of Company owned and operated stores from transactions with a related party of | 59,776 | 96,605 | 13,581 | 136,351 | 225,071 | 31,640 | |||||||||||||
Rental expenses | 42,877 | 36,131 | 5,079 | 101,287 | 134,145 | 18,858 | |||||||||||||
Payroll and employee benefits | 59,604 | 65,992 | 9,277 | 127,502 | 202,158 | 28,419 | |||||||||||||
Delivery costs | 11,225 | 23,590 | 3,316 | 24,680 | 51,699 | 7,268 | |||||||||||||
Other operating expenses (including service fee from transactions with a related party of | 46,451 | 77,538 | 10,900 | 103,540 | 196,532 | 27,628 | |||||||||||||
Company owned and operated store costs and expenses | 219,933 | 299,856 | 42,153 | 493,360 | 809,605 | 113,813 | |||||||||||||
Costs of other revenues | 5,560 | 9,451 | 1,329 | 10,202 | 26,445 | 3,718 | |||||||||||||
Marketing expenses | 14,578 | 24,851 | 3,493 | 29,791 | 56,715 | 7,973 | |||||||||||||
General and administrative expenses | 49,364 | 109,567 | 15,403 | 116,405 | 223,085 | 31,361 | |||||||||||||
Franchise and royalty expenses (including franchise and royalty expenses from transactions with a related party of | 5,126 | 11,021 | 1,549 | 13,455 | 25,301 | 3,557 | |||||||||||||
Other operating costs and expenses | 424 | 1,377 | 194 | 489 | 5,945 | 836 | |||||||||||||
Loss on disposal of property and equipment | 391 | 1,475 | 207 | 1,132 | 8,835 | 1,242 | |||||||||||||
Impairment losses of long-lived assets | - | - | - | - | 5,473 | 769 | |||||||||||||
Other income | 281 | 1,404 | 197 | 319 | 1,999 | 281 | |||||||||||||
Total costs and expenses, net | 295,095 | 456,194 | 64,131 | 664,515 | 1,159,405 | 162,988 | |||||||||||||
Operating loss | (112,964 | ) | (150,475 | ) | (21,154 | ) | (245,118 | ) | (449,822 | ) | (63,236 | ) | |||||||
Interest income | 20 | 642 | 90 | 286 | 976 | 137 | |||||||||||||
Interest expenses | (183 | ) | (4,262 | ) | (599 | ) | (183 | ) | (10,280 | ) | (1,445 | ) | |||||||
Foreign currency transaction (loss)/gain | 34 | (367 | ) | (52 | ) | (907 | ) | (1,135 | ) | (160 | ) | ||||||||
Changes in fair value of convertible notes | - | 19,452 | 2,735 | - | (1,627 | ) | (229 | ) | |||||||||||
Changes in fair value of warrant liabilities | - | 9,950 | 1,399 | - | 9,950 | 1,399 | |||||||||||||
Changes in fair value of | - | (69,932 | ) | (9,831 | ) | - | (69,932 | ) | (9,831 | ) | |||||||||
Loss before income taxes | (113,093 | ) | (194,992 | ) | (27,412 | ) | (245,922 | ) | (521,870 | ) | (73,365 | ) | |||||||
Income tax expenses | - | - | - | - | - | - | |||||||||||||
Net loss | (113,093 | ) | (194,992 | ) | (27,412 | ) | (245,922 | ) | (521,870 | ) | (73,365 | ) | |||||||
Less: Net Loss attributable to non-controlling interests | (2,086 | ) | (611 | ) | (86 | ) | (2,532 | ) | (3,092 | ) | (435 | ) | |||||||
Net Loss attributable to shareholders of the Company | (111,007 | ) | (194,381 | ) | (27,326 | ) | (243,390 | ) | (518,778 | ) | (72,930 | ) | |||||||
Basic and diluted loss per Ordinary Share | (0.90 | ) | (1.56 | ) | (0.22 | ) | (2.02 | ) | (4.17 | ) | (0.59 | ) | |||||||
Net loss | (113,093 | ) | (194,992 | ) | (27,412 | ) | (245,922 | ) | (521,870 | ) | (73,365 | ) | |||||||
Other comprehensive income | |||||||||||||||||||
Fair value changes of convertible notes due to instrument-specific credit risk, net of nil income taxes | - | (3,262 | ) | (459 | ) | - | (2,026 | ) | (285 | ) | |||||||||
Foreign currency translation adjustment, net of nil income taxes | 308 | (14,088 | ) | (1,980 | ) | (776 | ) | (24,628 | ) | (3,462 | ) | ||||||||
Total comprehensive loss | (112,785 | ) | (212,342 | ) | (29,851 | ) | (246,698 | ) | (548,524 | ) | (77,112 | ) | |||||||
Less: Comprehensive loss attributable to non- controlling interests | (2,086 | ) | (611 | ) | (86 | ) | (2,532 | ) | (3,092 | ) | (435 | ) | |||||||
Comprehensive loss attributable to shareholders of the Company | (110,699 | ) | (211,731 | ) | (29,765 | ) | (244,166 | ) | (545,432 | ) | (76,677 | ) | |||||||
TH INTERNATIONAL LIMITED AND SUBSIDIARIES | |||||||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||
(Amounts in thousands of RMB and US$) | |||||||||||||||||||
For the three months ended | For the nine months ended | ||||||||||||||||||
2021 | 2022 | 2021 | 2022 | ||||||||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||||||
Net cash used in operating activities | (73,517 | ) | (35,884 | ) | (5,044 | ) | (188,244 | ) | (190,826 | ) | (26,826 | ) | |||||||
Net cash used in investing activities | (99,767 | ) | (431,081 | ) | (60,600 | ) | (221,003 | ) | (611,435 | ) | (85,954 | ) | |||||||
Net cash provided by financing activities | 82,587 | 563,473 | 79,212 | 370,057 | 790,079 | 111,068 | |||||||||||||
Effect of foreign currency exchange rate changes on cash | 93 | 806 | 113 | (1,285 | ) | 3,793 | 533 | ||||||||||||
Net decrease in cash | (90,604 | ) | 97,314 | 13,680 | (40,475 | ) | (8,389 | ) | (1,179 | ) | |||||||||
Cash at beginning of the period | 225,003 | 285,134 | 40,084 | 174,874 | 390,837 | 54,943 | |||||||||||||
Cash at end of the period | 134,399 | 382,448 | 53,764 | 134,399 | 382,448 | 53,764 | |||||||||||||
TH INTERNATIONAL LIMITED AND SUBSIDIARIES | |||||||||||||
RECONCILIATION OF NON-GAAP MEASURES TO THE MOST DIRECTLY COMPARABLE GAAP MEASURES | |||||||||||||
(Unaudited, amounts in thousands of RMB and US$, except for number of shares and per share data) | |||||||||||||
A. Adjusted store EBITDA and adjusted store EBITDA margin | |||||||||||||
For the three months ended | For the nine months ended | ||||||||||||
2021 | 2022 | 2021 | 2022 | ||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | ||||||||
Revenues - company owned and operated stores | 173,703 | 290,009 | 40,769 | 403,573 | 665,588 | 93,567 | |||||||
Food and packaging costs - company owned and operated stores | (59,776) | (96,605) | (13,581) | (136,351) | (225,071) | (31,640) | |||||||
Rental expenses - company owned and operated stores | (42,877) | (36,131) | (5,079) | (101,287) | (134,145) | (18,858) | |||||||
Payroll and employee benefits - company owned and operated stores | (59,604) | (65,992) | (9,277) | (127,502) | (202,158) | (28,419) | |||||||
Delivery costs - company owned and operated stores | (11,225) | (23,590) | (3,316) | (24,680) | (51,699) | (7,268) | |||||||
Other operating expenses - company owned and operated stores | (46,451) | (77,538) | (10,900) | (103,540) | (196,532) | (27,628) | |||||||
Franchise and royalty expenses - company owned and operated stores | (5,126) | (11,021) | (1,549) | (13,455) | (25,301) | (3,557) | |||||||
Fully-burdened gross loss - company owned and operated stores | (51,356) | (20,868) | (2,933) | (103,242) | (169,318) | (23,803) | |||||||
Depreciation and amortization | 19,453 | 35,943 | 5,053 | 46,124 | 95,233 | 13,388 | |||||||
Store pre-opening expenses | 36,335 | 4,277 | 601 | 70,118 | 26,660 | 3,748 | |||||||
Adjusted Store EBITDA | 4,432 | 19,352 | 2,721 | 13,000 | (47,425) | (6,667) | |||||||
Adjusted Store EBITDA Margin | 2.6% | 6.7% | 6.7% | 3.2% | -7.1% | -7.1% | |||||||
B. Adjusted general and administrative expenses | |||||||||||||
For the three months ended | For the nine months ended | ||||||||||||
2021 | 2022 | 2021 | 2022 | ||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | ||||||||
General and administrative expenses | (49,364) | (109,567) | (15,403) | (116,405) | (223,085) | (31,361) | |||||||
Adjusted for: | |||||||||||||
Share-based compensation expenses | - | 33,276 | 4,678 | - | 33,276 | 4,678 | |||||||
Commission fee for Cantor shares | - | 21,521 | 3,025 | - | 21,521 | 3,025 | |||||||
Option granted by controlling shareholder to CB holder | - | 1,778 | 250 | - | 1,778 | 250 | |||||||
Offering costs for | - | 4,622 | 650 | - | 4,622 | 650 | |||||||
Adjusted General and administrative expenses | (49,364) | (48,370) | (6,800) | (116,405) | (161,888) | (22,758) | |||||||
C. Adjusted corporate EBITDA and adjusted corporate EBITDA margin | |||||||||||||
For the three months ended | For the nine months ended | ||||||||||||
2021 | 2022 | 2021 | 2022 | ||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | ||||||||
Operating loss | (112,964) | (150,475) | (21,154) | (245,118) | (449,822) | (63,236) | |||||||
Adjusted for: | |||||||||||||
Store pre-opening expenses | 36,335 | 4,277 | 601 | 70,118 | 26,660 | 3,748 | |||||||
Depreciation and amortization | 19,453 | 35,943 | 5,053 | 46,124 | 95,233 | 13,388 | |||||||
Share-based compensation expenses | - | 33,276 | 4,678 | - | 33,276 | 4,678 | |||||||
Commission fee for Cantor shares | - | 21,521 | 3,025 | - | 21,521 | 3,025 | |||||||
Option granted by controlling shareholder to CB holder | - | 1,778 | 250 | - | 1,778 | 250 | |||||||
Offering costs for | - | 4,622 | 650 | - | 4,622 | 650 | |||||||
Impairment losses of long-lived assets | - | - | - | - | 5,473 | 769 | |||||||
Loss on disposal of property and equipment | 391 | 1,475 | 207 | 1,132 | 8,835 | 1,242 | |||||||
Adjusted Corporate EBITDA | (56,785) | (47,583) | (6,690) | (127,744) | (252,424) | (35,486) | |||||||
Adjusted Corporate EBITDA Margin | -31.2% | -15.6% | -15.6% | -30.5% | -35.6% | -35.6% | |||||||
D. Adjusted net loss and adjusted net loss margin | |||||||||||||
For the three months ended | For the nine months ended | ||||||||||||
2021 | 2022 | 2021 | 2022 | ||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | ||||||||
Net loss | (113,093) | (194,992) | (27,412) | (245,922) | (521,870) | (73,365) | |||||||
Adjusted for: | |||||||||||||
Store pre-opening expenses | 36,335 | 4,277 | 601 | 70,118 | 26,660 | 3,748 | |||||||
Share-based compensation expenses | - | 33,276 | 4,678 | - | 33,276 | 4,678 | |||||||
Commission fee for Cantor shares | - | 21,521 | 3,025 | - | 21,521 | 3,025 | |||||||
Option granted by controlling shareholder to CB holder | - | 1,778 | 250 | - | 1,778 | 250 | |||||||
Offering costs for | - | 4,622 | 650 | - | 4,622 | 650 | |||||||
Impairment losses of long-lived assets | - | - | - | - | 5,473 | 769 | |||||||
Loss on disposal of property and equipment | 391 | 1,475 | 207 | 1,132 | 8,835 | 1,242 | |||||||
Changes in fair value of convertible notes | - | (19,452) | (2,735) | - | 1,627 | 229 | |||||||
Changes in fair value of warrant liabilities | - | (9,950) | (1,399) | - | (9,950) | (1,399) | |||||||
Changes in fair value of | - | 69,932 | 9,831 | - | 69,932 | 9,831 | |||||||
Adjusted Net loss | (76,367) | (87,513) | (12,304) | (174,672) | (358,096) | (50,342) | |||||||
Adjusted Net loss Margin | -41.9% | -28.6% | -28.6% | -41.6% | -50.5% | -50.5% | |||||||
TH INTERNATIONAL LIMITED AND SUBSIDIARIES | |||||||||||||
RECONCILIATION OF NON-GAAP MEASURES TO THE MOST DIRECTLY COMPARABLE GAAP MEASURES | |||||||||||||
(Unaudited, amounts in thousands of RMB and US$, except for number of shares and per share data) | |||||||||||||
E. Adjusted basic and diluted net loss per Ordinary Share | |||||||||||||
For the three months ended | For the nine months ended | ||||||||||||
2021 | 2022 | 2021 | 2022 | ||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | ||||||||
Net Loss attributable to shareholders of the Company | (111,007) | (194,381) | (27,326) | (243,390) | (518,778) | (72,930) | |||||||
Adjusted for: | |||||||||||||
Store pre-opening expenses | 36,335 | 4,277 | 601 | 70,118 | 26,660 | 3,748 | |||||||
Share-based compensation expenses | - | 33,276 | 4,678 | - | 33,276 | 4,678 | |||||||
Commission fee for Cantor shares | - | 21,521 | 3,025 | - | 21,521 | 3,025 | |||||||
Option granted by controlling shareholder to CB holder | - | 1,778 | 250 | - | 1,778 | 250 | |||||||
Offering costs for | - | 4,622 | 650 | - | 4,622 | 650 | |||||||
Impairment losses of long-lived assets | - | - | - | - | 5,473 | 769 | |||||||
Loss on disposal of property and equipment | 391 | 1,475 | 207 | 1,132 | 8,835 | 1,242 | |||||||
Changes in fair value of convertible notes | - | (19,452) | (2,735) | - | 1,627 | 229 | |||||||
Changes in fair value of warrant liabilities | - | (9,950) | (1,399) | - | (9,950) | (1,399) | |||||||
Changes in fair value of | - | 69,932 | 9,831 | - | 69,932 | 9,831 | |||||||
Adjusted Net loss attributable to shareholders of the Company | (74,281) | (86,902) | (12,218) | (172,140) | (355,004) | (49,907) | |||||||
Weighted average shares outstanding used in calculating basic and diluted loss per share | 124,024,580 | 124,699,448 | 124,701,053 | 120,703,179 | 124,368,131 | 124,370,421 | |||||||
Adjusted basic and diluted net loss per Ordinary Share | (0.60) | (0.70) | (0.10) | (1.43) | (2.85) | (0.40) | |||||||
Source:
2022 GlobeNewswire, Inc., source