TH International Ltd (THCH) 2024 Q4 法說會逐字稿

Ladies and gentlemen, welcome to Tim's China's fourth-quarter 2024 earnings conference call. (Operator Instructions). Today's conference is being recorded.

女士們，先生們，歡迎參加 Tim 的中國 2024 年第四季財報電話會議。（操作員指令）。今天的會議正在錄製中。

At this time, I would like to turn the call over to Gemma Bakx, who heads Tim's China's Investor relations efforts for prepared remarks and introductions. Please go ahead, Gemma.

現在，我想將電話轉給蒂姆中國投資者關係部負責人 Gemma Bakx，請她發表準備好的演講和介紹。請繼續，傑瑪。

Thank you very much. Hello, everyone, and thank you for joining us on today's call. My name is Gemma Bakx, Head of Investor Relations of Tims China. We announced fourth quarter and full year results 2024 earlier today. A press release as well as an accompanying presentation, which contains operational and financial highlights are now available on the company's IR website, ir.timschina.com.

非常感謝。大家好，感謝您參加今天的電話會議。我叫 Gemma Bakx，是 Tims 中國區投資人關係主管。我們今天早些時候公佈了 2024 年第四季度和全年業績。新聞稿以及包含營運和財務亮點的隨附簡報現已在該公司的 IR 網站 ir.timschina.com 上發布。

Today, you will hear from Yongchen Lu, our CEO and Director; and Albert Li, our CFO. After the company's prepared remarks, the management team will conduct a question-and-answer session. You can find the slide presentation and the webcast of today's earnings call on our IR website.

今天，您將聽到我們的執行長兼董事陸永晨和財務長李偉的發言。公司準備好的發言結束後，管理團隊將進行問答環節。您可以在我們的 IR 網站上找到今天收益電話會議的幻燈片演示和網路直播。

Before we get started, I'd like to remind you that our earnings presentation and investor materials contain forward-looking statements, which are subject to future events and uncertainties. Statements that are not historical facts, including, but not limited to statements about the company's beliefs and expectations are forward-looking statements.

在我們開始之前，我想提醒您，我們的收益報告和投資者資料包含前瞻性陳述，這些陳述受未來事件和不確定性的影響。非歷史事實的陳述，包括但不限於有關公司信念和期望的陳述，均為前瞻性陳述。

Those forward-looking statements involve inherent risks and uncertainties, and our actual results may differ materially from these forward-looking statements. All forward-looking statements should be considered in conjunction with the cautionary statements in our earnings release and risk factors included in our filings with the SEC.

這些前瞻性陳述涉及固有風險和不確定性，我們的實際結果可能與這些前瞻性陳述有重大差異。所有前瞻性陳述都應與我們收益報告中的警示性聲明以及我們向美國證券交易委員會提交的文件中包含的風險因素一起考慮。

This presentation also includes certain non-GAAP financial measures, which we believe can be helpful in evaluating our performance. However, those measures should not be considered substitutes for the comparable GAAP measures. The accompanying reconciliation information related to those non-GAAP and GAAP measures can be found in our earnings press release issued earlier today.

本報告也包括某些非公認會計準則財務指標，我們認為這些指標有助於評估我們的績效。然而，這些指標不應被視為可比較 GAAP 指標的替代品。在我們今天稍早發布的收益新聞稿中可以找到與這些非 GAAP 和 GAAP 指標相關的隨附調整資訊。

With that said, I would now like to turn it over to Yongchen Lu, our CEO and Director. Please go ahead, Yongchen.

說完這些，我現在想把發言權交給我們的執行長兼董事陸永晨。請繼續，永辰。

Thank you, Gemma. Good morning and good evening, everyone. 2024 marked a pivotal year for the company. We solidified our differentiated strategic positioning in coffee plus fresh prepared food, completed the made-to-order renovation of almost all company owned and operated stores, surpassed 24 million registered loyalty club members and received over 6,200 individual sub-franchisee applications by year-end.

謝謝你，傑瑪。大家早安，晚上好。 2024年是公司關鍵的一年。我們鞏固了在咖啡和新鮮食品領域的差異化策略定位，完成了幾乎所有公司自營門店的客製化改造，截至年底，註冊忠誠俱樂部會員超過 2,400 萬，並收到了超過 6,200 份個人分特許經營申請。

In Q4 2024, we celebrated the grand opening of the 1,000th Tims China Shopping Center Shanghai, where the Tims China story began. This achievement is a testament to Tims China's enduring presence in the region and to our ambition for further growth.

2024年第四季度，我們慶祝第1000家Tims中國購物中心上海盛大開業，Tims中國的故事從這裡開始。這項成就證明了 Tims 中國在該地區的持久影響力以及我們進一步發展的雄心。

Amidst macroeconomic volatility and intense market competition, our team demonstrated great resilience and achieved significant profitability improvements through enhanced operational efficiencies, supply chain optimizations and rigorous cost controls.

在宏觀經濟波動和激烈的市場競爭中，我們的團隊展現了強大的韌性，透過提高營運效率、優化供應鏈和嚴格的成本控制實現了顯著的獲利能力提升。

2024 full year company-owned and operated store contribution margin, which is EBIT margin previously and full year adjusted corporate EBITDA margin improved by 5.3 percentage points and 9.9 percentage points year-over-year, respectively. Continuous product innovation has always been a strategic focus for us. In 2024, we launched a total of 92 new products, 47 new beverages and 45 new food items, which contribute approximately 25% of our top line sales.

2024年全年公司自營店貢獻利潤率（即之前的EBIT利潤率）和全年調整後企業EBITDA利潤率分別年增5.3個百分點和9.9個百分點。持續的產品創新一直是我們的策略重點。2024年，我們共推出92款新產品、47款新飲料和45款新食品，約占我們營業額的25%。

Then our offerings have resonated strongly with our guests, such as beverages, including (inaudible) fragrant coconut water (spoken in foreign language) and buffalo milk latte (spoken in foreign language), and food items include Angus beef and cheese (spoken in foreign language), Pistachio Smile Bagel (spoken in foreign language), Black Gold Cheese Mammoth Bagel, (spoken in foreign language) et cetera. We continue to strengthen our leadership in the bagel platform, selling a total of approximately 22 million bagel and bagel sandwich products in 2024.

然後，我們提供的產品引起了客人的強烈共鳴，例如飲料，包括（聽不清）香濃椰子水（用外語說）和水牛奶拿鐵（用外語說），食品包括安格斯牛肉和奶酪（用外語說）、開心果微笑百吉餅（用外語說）、黑金奶酪猛獁象百吉餅，（用外語說百吉餅）等等。我們繼續加強在百吉餅平台的領導地位，到 2024 年，百吉餅和百吉餅三明治產品的總銷量將達到約 2,200 萬個。

To boost revenue across breakfast, lunch and afternoon tea daypart, we have launched an all-day solution tailored to our guests' needs at different times. We have customized our operations for each day of the day -- each part of the day, shifting from simple promotions to scenario situation-based strategies. We have focused on understanding and meeting our guests' specific needs during each time period.

為了提高早餐、午餐和下午茶時段的收入，我們推出了全天候解決方案，以滿足客人在不同時段的需求。我們針對每天的每一天、每一個部分客製化了我們的運營，從簡單的促銷轉變為基於情境的策略。我們致力於了解並滿足客人在每個時間段內的特定需求。

For instance, we introduced a breakfast combo with croissants, which suits morning routines and offers great value starting from RMB14.9, just about USD2. Building on our classic bagel breakfast sets, the croissant combo includes protein-rich options like meat, catering to high energy needs in colder months. Meanwhile, the croissants itself is live yet satisfying, perfect for those wanting a hardy but not overly filling breakfast.

例如，我們推出了包含羊角麵包的早餐套餐，非常適合早晨的習慣，而且價格非常實惠，起價為人民幣 14.9 元，約合 2 美元。在我們經典的百吉餅早餐套餐的基礎上，羊角麵包組合包括肉類等富含蛋白質的選擇，可滿足寒冷月份的高能量需求。同時，羊角麵包本身是新鮮的，但卻令人滿意，非常適合那些想要一頓豐盛但又不會太飽的早餐的人。

Recently to boost the lunch sales and offer our guests a healthy lunch options, we have introduced the light bagel burger lunch box, cheesy bagel bowl (inaudible) this product caters to the needs of health-conscious consumers by providing a nutritious and convenient meal.

最近，為了提高午餐銷量並為我們的客人提供健康的午餐選擇，我們推出了輕便百吉餅漢堡午餐盒、芝士百吉餅碗（聽不清），該產品通過提供營養又方便的膳食來滿足注重健康的消費者的需求。

The lunch box combines a light yet filling bagel burger with other healthy yet tasty items, making a perfect choice for those who want a satisfying lunch without a heavy feeling. This product series pricing competitively from RMB25.8, just about USD3.5 has been warmly welcomed by market since the launch, contributing meaningfully incremental daily transactions per store.

午餐盒將輕盈而飽腹的百吉餅漢堡與其他健康又美味的食物結合在一起，對於那些想要一頓令人滿意的午餐而又不想感到沉重的人來說，這是一個完美的選擇。該系列產品價格極具競爭力，僅為人民幣25.8元，約合3.5美元，自推出以來就受到市場熱烈歡迎，為單店日交易量貢獻了顯著的增長。

In 2024, we strategically expanded our store footprint while maintaining capital efficiency, delivering absolute convenience for our guests. A significant milestone was reached in Q4 2024 with the grand opening of Tims China 1,000th store in Shanghai, marking a pivotal moment in our national expansion journey. Leveraging sub-franchisee partnerships, we accelerate in our market penetration, entering into 82 cities by year-end, including the debut of our first stores in Chuzhou, Hengshui, Jiangmen, Shenzen and Suzhou during the fourth quarter of 2024.

2024年，我們在維持資本效率的同時，策略性地擴大了門市規模，為顧客提供了絕對的便利。2024 年第四季度，Tims 中國第 1000 家門市在上海盛大開業，標誌著我們全國擴張之旅的關鍵時刻，標誌著我們迎來了一個重要的里程碑。我們利用次級特許經營合作夥伴關係，加速市場滲透，截至年底已進入 82 個城市，其中包括於 2024 年第四季在滁州、衡水、江門、深圳和蘇州開設首家門市。

This growth strategy not only strengthened our brand presence, but also ensured sustainable scalability through optimized resource allocation. Since we launched our individual franchisee business in December 2023, we have received over 6,200 applications and successfully opened around 100 stores by the year end of 2024 and signing a lot more, showcasing market confidence in our franchise model.

這項成長策略不僅增強了我們的品牌影響力，而且透過優化資源配置確保了可持續的可擴展性。自 2023 年 12 月推出個人特許經營業務以來，我們已收到超過 6,200 份申請，到 2024 年底已成功開設約 100 家門店，並簽約更多門市，展現了市場對我們特許經營模式的信心。

We have established an attractive store unit economics for our sub-franchisees with a reasonable two to three years payback period on average. As of December 31, 2024, our registered loyalty club members exceeded 24 million, reflecting a remarkable 29.7% year-over-year growth. The average number of members per store has now surpassed 23,000, serving a strong catalyst for our growth in the future and clearly demonstrating our guests' ongoing support for Tims China loyalty programs, which inspires our team to continue delivering the best value for quality products and services.

我們為我們的次級特許經營商建立了具有吸引力的店鋪單位經濟效益，平均投資回收期為兩到三年。截至 2024 年 12 月 31 日，我們的註冊忠誠俱樂部會員超過 2,400 萬，年增 29.7%。目前每家門市的平均會員數量已超過23,000名，這為我們未來的成長提供了強大的催化劑，也清楚地表明了我們的客人對Tims中國忠誠度計劃的持續支持，這激勵著我們的團隊繼續提供最優質的產品和服務。

At this time, I would like to turn it over to our CFO, Albert Li, to discuss our fourth quarter and full year 2024 financial performance in more detail.

現在，我想將時間交給我們的財務長 Albert Li，更詳細地討論我們 2024 年第四季和全年的財務表現。

Thank you, Yongchen. We are committed to further improving our financial performance by refining store unit economics and driving efficiencies at both store and corporate levels. Our sub-franchisee business also contributed steady cash flows and profitability. During the first quarter of 2024, we continued to improve our company-owned and operated store contribution margin and adjusted corporate EBITDA margin by 3.9 percentage points and 0.1 percentage points, respectively.

謝謝你，永辰。我們致力於透過改善門市單位經濟效益以及提高門市和公司層面的效率來進一步提高我們的財務表現。我們的特許經營業務也貢獻了穩定的現金流和獲利能力。2024 年第一季度，我們持續提高公司自營店貢獻利潤率和調整後公司 EBITDA 利潤率，分別提高 3.9 個百分點和 0.1 個百分點。

Full year 2024 company operated -- company-owned and operated store contribution margin and adjusted corporate EBITDA margin improved by 5.3 percentage points and 9.9 percentage points, respectively.

2024 年全年公司經營－公司自營店貢獻利潤率和調整後公司 EBITDA 利潤率分別提高了 5.3 個百分點和 9.9 個百分點。

We remain focused on delivering high value for quality healthy products and services to our growing customer base. Our overall monthly average transacting customers reached 3.01 million in Q4 2024, a 1.0% increase from 2.98 million in the same quarter of 2023.

我們始終致力於為不斷成長的客戶群提供高價值的優質健康產品和服務。2024 年第四季度，我們的整體月平均交易客戶數達到 301 萬，較 2023 年同期的 298 萬成長 1.0%。

Additionally, digital orders as a percentage of total orders rose from 83.6% in Q4 2023 to 86.1% in Q4 2024. We continue to enhance our digital capabilities to meet the growing demand for delivery and takeaway services. Our 2024 full year total revenues and system sales dropped by 10.8% and 6.2% year-over-year, respectively, which was primarily due to the closure of certain underperforming stores and a 15.8% decrease in the same-store sales growth for system-wide stores, offset by a 105.3% increase in our sub-franchisee business revenues as the number of our franchised stores increased from 283 as of December 31, 2023, to 446 as of December 31, 2024.

此外，數位訂單佔總訂單的比例從 2023 年第四季的 83.6% 上升到 2024 年第四季的 86.1%。我們持續增強數位化能力，以滿足日益增長的外送和外送服務需求。我們 2024 年全年總收入和系統銷售額分別同比下降 10.8% 和 6.2%，這主要是由於關閉了某些業績不佳的門市以及全系統門市的同店銷售額增長下降 15.8%，但由於我們的特許經營店數量從 2023 年 12 月 31 日的 283 年 1423 年的 1243 年 14 月家，我們的次特許經營業務收入成長了 105.3%，從而抵消了這一影響。

In 2024, we made significant progress in boosting operational efficiency, setting the stage for our long-term sustainable growth. Through refinements in our supply chain capabilities and economy of scale, we reduced the food and packaging costs as a percentage of revenues from company-owned and operated stores by 3.5 percentage points year-over-year.

2024年，我們在提升營運效率方面取得了重大進展，為長期永續成長奠定了基礎。透過改善我們的供應鏈能力和規模經濟，我們將食品和包裝成本占公司自營商店收入的百分比比去年同期降低了 3.5 個百分點。

As many of you may know, we source most of our coffee beans from the RBI global coffee beans ecosystem, mostly in Malaysia and also recently in Yunnan provinces of China. And our other supply chain are sourced locally. Geopolitical tensions, natural disasters and unexpected events can disrupt even the most efficient supply chains.

大家可能都知道，我們大部分的咖啡豆都來自 RBI 全球咖啡豆生態系統，主要是馬來西亞，最近也有來自中國雲南省的咖啡豆。我們的其他供應鏈均來自本地。地緣政治緊張局勢、自然災害和意外事件甚至可能擾亂最高效的供應鏈。

While with our strong and diversified supply chain, we have well mitigated these risks to ensure a reliable flow of products to our stores and our guests while maintaining exacting standard. We continue to streamline our operations by pulling underperforming stores, optimizing unit economics, refining staffing arrangement and optimizing store managerial efficiencies. These actions led to a year-over-year reduction in rental and property management fees, labor costs and other operating expenses as a percentage of revenues from company-owned and operated stores by 0.5 percentage points, 2.4 percentage points and 0.5 percentage points year-over-year, respectively.

而憑藉我們強大而多樣化的供應鏈，我們很好地降低了這些風險，以確保產品可靠地流向我們的商店和客人，同時保持嚴格的標準。我們繼續精簡運營，撤出表現不佳的門市，優化單位經濟效益，改善人員安排，優化門市管理效率。這些措施導致租金及物業管理費、人力成本和其他營業費用占公司自營門市收入的比例分別較去年同期下降0.5個百分點、2.4個百分點和0.5個百分點。

Benefiting from our cost optimization measures and increased brand recognition, our marketing expenses as a percentage of total revenues decreased by 1.5 percentage points year-over-year. Our adjusted general and administrative expenses as a percentage of total revenues increased by 0.3 percentage points year-over-year.

受惠於我們的成本優化措施和品牌知名度的提高，我們的行銷費用佔總收入的比例年減了1.5個百分點。我們的調整後一般及行政開支佔總收入的百分比年增了 0.3 個百分點。

Excluding those onetime nonrecurring items like credit losses of accounts receivables and professional fees regarding transactions for the Popeyes deal and related with the reverse stock split, our adjusted general and administrative expenses as a percentage of total revenues would have been decreased by 2.3 percentage points year-over-year, which led to basically a drop from 13.9% in 2023 to 11.6% in 2024. So with all these good efforts, we have been able to improve adjusted corporate EBITDA margin by a very remarkable 9.9 percentage points in 2024.

不包括應收帳款信用損失和與 Popeyes 交易及反向股票分割相關的專業費用等一次性非經常性項目，我們的調整後一般及行政開支佔總收入的百分比將同比下降 2.3 個百分點，從 2023 年的 13.9% 基本下降到 2024 年的 11.6%。因此，透過所有這些努力，我們能夠在 2024 年將調整後的企業 EBITDA 利潤率提高非常顯著的 9.9 個百分點。

Turning to liquidity. As of December 31, 2024, our total cash and cash equivalents, time deposits and restricted cash were RMB184.2 million compared to RMB219.5 million as of December 31, 2023. The change was primarily attributable to the financing from our funding shareholders, partially offset by cash disbursements on the back of the expansion of our business and store network nationwide and the repayment of certain bank borrowings.

轉向流動性。截至 2024 年 12 月 31 日，我們的現金及現金等價物、定期存款及受限現金總額為人民幣 1.842 億元，而截至 2023 年 12 月 31 日為人民幣 2.195 億元。這項變更主要歸因於我們來自融資股東的融資，但部分被我們在全國範圍內的業務和門市網絡擴張以及償還某些銀行借款所帶來的現金支出所抵消。

Looking ahead, and thanks to our team's resilience and tireless work, Tims China is standing at the turning point to achieve full year corporate EBITDA breakeven with profitable growth being front and center of everything we do, we are excited to further enhance our supply chain capabilities and efficiencies, roll out our differentiating made-to-order fresh and healthy food preparation model to drive traffic. Finance optimization of overall store unit economics and accelerate the expansion of our successful sub-franchising.

展望未來，憑藉團隊的堅韌和不懈努力，Tims中國正站在實現全年企業EBITDA收支平衡的轉折點上，盈利增長是我們一切工作的重中之重，我們很高興進一步增強我們的供應鏈能力和效率，推出我們差異化的定制新鮮健康食品製備模式來推動客流量。對整個門市單位經濟效益進行財務優化，並加速我們成功的子特許經營的擴張。

I will now turn over to Yongchen for concluding remarks followed by Q&A.

現在請陳永臣作總結發言，然後再進行問答。

Thank you, Albert. Before we turn to Q&A, I would like to take this opportunity to once again express my heartfelt gratitude for our guests, employees, business partners and investors for your continued support, dedication and trust during the past six years. Despite the challenging time during the two year COVID period and the fierce price competition in the past couple of years, together, we have built the brand from scratch to over 1,000 stores in 82 cities, create a robust community of over 24 million loyalty club members, a unique Coffee Plus Fresh Prepared Food business model offering the best value for quality products and a unique advantage of offering franchise opportunities as an international coffee brand.

謝謝你，阿爾伯特。在進入問答環節之前，我想藉此機會再次向我們的嘉賓、員工、業務合作夥伴和投資者表示衷心的感謝，感謝你們在過去六年裡的持續支持、奉獻和信任。儘管在兩年的新冠疫情期間充滿挑戰，並且在過去幾年中價格競爭激烈，但我們共同努力，將品牌從零開始發展到在82個城市擁有1000多家門市，創建了一個擁有超過2400萬忠誠俱樂部會員的強大社區，獨特的「咖啡加新鮮預製食品」商業模式，為優質產品提供最佳價值，並作為國際咖啡品牌提供特許經營機會的獨特優勢。

With these milestones behind us and with our demonstrated operational flexibility, we are steadfast in our commitment to sustainable growth and to generating long-term value for our shareholders. Moving into the spring of 2025, we look forward to regaining growth on our top line and to continue our expansion with plans to open at least 200 stores this year, the majority of which will be through our successful subfranchise while maintaining our focus on operational excellence and profitability.

憑藉這些里程碑以及我們所展現的營運靈活性，我們堅定不移地致力於永續成長並為股東創造長期價值。進入 2025 年春季，我們期待恢復營收成長，並繼續擴張，計劃今年開設至少 200 家門市，其中大部分將透過我們成功的特許經營店開設，同時繼續專注於卓越營運和盈利能力。

I will now turn the call over to Gemma for today's Q&A session. Gemma?

現在我將把今天的問答環節交給 Gemma。芽？

Thank you, Yongchen. We'll send it over to Q&A and open it for a registered question. Let's begin with the first one. Go ahead, operator.

謝謝你，永辰。我們會將其發送到問答部分並開放供註冊提問。讓我們從第一個開始。請繼續，接線生。

(Operator Instructions)

（操作員指示）

Steve Silver, Argus Research Corporation.

史蒂夫‧西爾弗 (Steve Silver)，阿格斯研究公司。

Thanks, operator, and thanks for taking my questions. Curious as to what your current thinking is on the state of the balance sheet, in particular, with the focus on profitable growth and sub-franchise expansion in 2025, if there are any specific strategies you're employing to manage cash flow while balancing growth and your debt obligations?

謝謝接線員，謝謝您回答我的問題。我很好奇您目前對資產負債表狀況的看法，特別是考慮到 2025 年的盈利增長和特許經營擴張，您是否採用了任何具體策略來管理現金流，同時平衡增長和債務義務？

Okay. Thanks. I think I will take this question first. Okay. So firstly, I want to mention as of the end of 2024, our total cash and cash equivalents balance totaled approximately RMB184 million. And on top of that, we have maintained a very stable total drawable bank facilities of approximately RMB400 million, I think, in the past couple of years. And actually, we are in the process of obtaining like new bank facilities as of now.

好的。謝謝。我想我會先回答這個問題。好的。首先，我想提一下，截至 2024 年底，我們的現金和現金等價物總額約為人民幣 1.84 億元。除此之外，我認為，在過去幾年裡，我們一直保持著非常穩定的可提取銀行信貸總額，約 4 億元。實際上，我們目前正在獲得新的銀行融資。

So that will be like one source of cash. And I think in the meantime, thanks to those meaningful improvements in our profitability at both the store and the corporate level and also as part of our rigorous implementation of our cost control initiatives and also including those -- our enhanced capability at supply chain. So basically, I think our store operating and also in terms of the headquarter actually -- expenses actually are quite streamlining.

所以這將會成為一種現金來源。我認為同時，得益於我們在商店和公司層面盈利能力的顯著提高，也得益於我們嚴格實施成本控制舉措，包括供應鏈能力的增強。所以基本上，我認為我們的商店運營以及總部的實際費用實際上已經相當精簡了。

So I think we have effectively slowed in terms of the cash burn rate actually compared with the past couple of years, okay? So -- and then I think as you have mentioned, our sub-franchising is -- can generate very steady cash flow and profitability while in the meantime, we can continue to expand our store network since the last couple of years.

因此我認為與過去幾年相比，我們的現金消耗率實際上已經有效減緩了，好嗎？所以——我認為正如您所提到的，我們的特許經營——可以產生非常穩定的現金流和盈利能力，同時，我們可以自過去幾年以來繼續擴大我們的門市網絡。

So that will -- we will continue to accelerate that from this year, okay? And we believe we have established a very attractive unit economics for our sub-franchisees with the two to three years payback on average, as Yongchen has mentioned. So basically, I think we are no longer cash burning like as in the past years.

所以從今年開始我們會繼續加速這個進程，好嗎？正如永晨所提到的那樣，我們相信我們已經為我們的次級特許經營商建立了非常有吸引力的單位經濟效益，平均回報期為兩到三年。所以基本上，我認為我們不再像過去幾年那樣燒錢了。

And so in the meantime, I think if we do want to expand in terms of the company-owned stores, we can actually rely on some additional bank facilities. And in the meantime, I also want to highlight the fact that in the past years, our like shareholders, including our funding shareholders, [Cartesian] and also RBI, they invested a very meaningful investment in the past. And this has showed a strong support from our shareholders to Tims China's sustainable growth. Yeah.

因此，同時，我認為如果我們確實想擴大公司自有商店的規模，我們實際上可以依靠一些額外的銀行融資。同時，我也想強調的是，在過去幾年裡，我們的股東，包括我們的資金股東 [Cartesian] 以及 RBI，他們都進行了非常有意義的投資。這也反映了股東對Tims中國永續發展的大力支持。是的。

Yeah. I just I want to add. Steve, thank you for your call. I just want to echo some points again. First of all, we are at the turning point achieve corporate EBITDA breakeven this year. And also, now we have proven our sub-franchising model with (inaudible) unit economics.

是的。我只是想補充一下。史蒂夫，謝謝你的來電。我只是想再次重申一些觀點。首先，我們今年正處於企業EBITDA收支平衡的轉捩點。而且，現在我們已經透過（聽不清楚）單位經濟學證明了我們的子特許經營模式。

So we'll use franchisee to expand our store network from now on, which is as an eyewear capital efficiency for us. So we don't need a lot of capital to grow the business here.

因此，從現在開始我們將利用特許經營商來擴大我們的門市網絡，這對我們來說是一種資本效率。所以我們不需要大量的資金來發展這裡的業務。

That's helpful. And one more, if I may. The price of coffee beans has been extremely volatile so far in 2025. I'm curious as to whether there are any implications on your thinking about food and packaging costs and store contribution margins.

這很有幫助。如果可以的話，我還要再說一句。到 2025 年為止，咖啡豆的價格一直極不穩定。我很好奇這對您對食品和包裝成本以及商店貢獻利潤的看法是否有任何影響。

Albert, you take that.

阿爾伯特，你拿著。

Okay, sure. Yeah. Okay. So I think actually, on the coffee bean side, I just firstly want to mention that actually, we rely on the RBI global coffee bean ecosystem in terms of supplying actually very reliable and I think it's cost-effective coffee bean cost in the past. And so even with the coffee bean like in terms of the coffee bean pricing increase, so I think like part of the measure we had is that we have started to source locally from those Yunnan coffee beans.

好的，當然。是的。好的。因此，我認為實際上，在咖啡豆方面，我首先想提一下，實際上，我們依賴 RBI 全球咖啡豆生態系統來供應，這實際上非常可靠，而且我認為過去的咖啡豆成本是具有成本效益的。因此，即使咖啡豆價格上漲，我認為我們採取的措施之一是開始從雲南本地採購咖啡豆。

This is relatively less expensive. And I think that the pricing actually is much better. And so our cooperation with Yunnan bean sources is under the cooperation with local roasteries in China approved by RBI, so in addition to what we already had with RBI's Malaysia roastery.

這相對來說比較便宜。我認為定價實際上要好得多。因此，我們與雲南豆源的合作是在與 RBI 批准的中國當地烘焙廠的合作下進行的，因此，除了我們已經與 RBI 馬來西亞烘焙廠的合作之外。

And secondly, I want to mention is that in terms of the coffee bean cost as a percentage of our total cost is actually it only accounted for about, I think, like less than 14% in terms of our overall food and paper costs. So actually, the overall coffee bean cost actually is not very material.

其次，我想說的是，就咖啡豆成本占我們總成本的百分比而言，實際上它只占我們整體食品和紙張成本的 14% 以下。所以實際上，咖啡豆的整體成本其實並不是很重要。

And in the meantime, Tim's menu is very diverse, featuring not only coffee, but also a variety of healthy food items like bagels and croissants right? So those diverse menu actually help us to mitigate the impact of -- on the increase of coffee bean costs. And we believe that with the current coffee bean pricing, actually, it can be quite mitigated by in terms of the downward pricing on our other supply chain materials. Okay. And I also want to highlight the fact that actually, last year, our total supply chain actually in terms of our gross margin has improved by 3.5% year-over-year.

同時，提姆的菜單非常多樣化，不僅有咖啡，還有各種健康食品，如百吉餅和羊角麵包，對吧？因此，這些多樣化的菜單實際上幫助我們減輕了咖啡豆成本上漲的影響。我們相信，以目前的咖啡豆價格來看，實際上，透過降低其他供應鏈材料的價格，可以在很大程度上緩解這一影響。好的。我還想強調的是，實際上，去年我們整個供應鏈的毛利率年增了 3.5%。

Okay. And I think lastly, I want to mention that if the coffee bean costs will maintain the current pricing, our expectation is that the overall impact on our like margins will be less than 90 basis points for the full year 2025 basis. So hopefully, this actually clarified the questions.

好的。最後我想說的是，如果咖啡豆成本維持當前價格，我們預計 2025 年全年對利潤率的整體影響將低於 90 個基點。所以希望這確實能澄清這些問題。

Okay, thank you so much for the color. I'll get back in the queue. Best of luck in 2025.

好的，非常感謝你提供的顏色。我會回到隊列中。祝你 2025 年好運。

Thank you too.

也謝謝你。

Thank you. We have a webcast question from Jonathan Norwood who asks, how are comp store sales trending so far in calendar 2025? And have the coffee price wars recessed at all?

謝謝。我們在網路直播中收到了來自喬納森·諾伍德 (Jonathan Norwood) 的一個問題，他問道，到 2025 年為止，同店銷售額的趨勢如何？咖啡價格戰是否已經結束？

Okay. Yeah, I'll take that question. So yeah, the same-store sales growth is a very important operating metric that we monitor closely. The fluctuations in the same-store sales growth over the past year reflects the short-term uncertainties in China economic and consumption sentiment and the intense industry competition. While in the mid-to-long term, with the increasing customer demand in coffee consumption from both expanding coffee population penetration rate and rising of frequences, which will leave significant room for growth.

好的。是的，我會回答這個問題。是的，同店銷售額成長是我們密切關注的一項非常重要的營運指標。過去一年同店銷售成長的波動反映了中國經濟和消費情緒的短期不確定性以及激烈的行業競爭。而中長期來看，隨著咖啡人口滲透率的擴大以及飲用頻率的上升，消費者對咖啡消費的需求將不斷增加，這將留下龐大的成長空間。

What's more, as we talked, again, again, in China is not only -- it's not singly focused on the coffee market, and we continue to see strong and growing demand for our freshly prepared healthy food products. For example, our latest launch of the lunch box, the light bagel burger lunch box. These products have been warmly welcomed by the market and achieving an average about 20-plus incremental daily transaction per store.

而且，正如我們再次談到的，中國不僅僅是——它不僅僅專注於咖啡市場，而且我們繼續看到對我們新鮮烹製的健康食品的強勁且不斷增長的需求。例如我們最新推出的午餐盒，輕便貝果漢堡午餐盒。這些產品受到了市場的熱烈歡迎，平均每家店每天新增交易額約20多筆。

And we are going to have another two ways to further enrich the lunch box offerings and drive further growth from there. Lastly, we have seen an improving trend in the same-store sales growth since October 2024, and our goal is to achieve positive same-store sales growth in 2025. Thank you.

我們也將透過另外兩種方式進一步豐富午餐盒的供應，並推動進一步的成長。最後，自 2024 年 10 月以來，我們看到同店銷售額成長呈現改善趨勢，我們的目標是在 2025 年實現同店銷售額正成長。謝謝。

(Operator Instructions)

（操作員指示）

We have another webcast question from Jonathan Norwood. Can you comment on your liquidity position as of today?

我們還有另一個來自喬納森諾伍德 (Jonathan Norwood) 的網路直播問題。您能評論一下您今天的流動性狀況嗎？

Yeah. I think we have actually addressed that question in terms of the balance sheet, okay? So as of the end of 2024, we had a total cash and cash equivalent of about RMB184 million. And in the meantime, I think we also had about like nearly RMB390 million in terms of our bank borrowings onshore. And also we had two convertible notes.

是的。我認為我們實際上已經在資產負債表方面解決了這個問題，好嗎？截至 2024 年底，我們的現金及現金等價物總額約為 1.84 億元人民幣。同時，我認為我們在境內的銀行借款也約為人民幣 3.9 億元。我們還有兩張可轉換票據。

One is actually on the [Sona] in 2021 and also one issued last year. Yeah, so I think based on our current -- in terms of our current business plan, we believe that actually we can maintain a good liquidity in terms of the potential like new bank facilities we will secure and also potential financing that I think currently we are contemplating, yes. So I think based on our management's current like business plan, we are well like capitalized.

其中一個實際上是在 2021 年的 [Sona] 上，還有一張是去年發行的。是的，所以我認為基於我們目前的業務計劃，我們相信實際上我們可以保持良好的流動性，例如我們將獲得的新銀行融資以及我認為我們目前正在考慮的潛在融資，是的。因此我認為，根據我們管理層目前的商業計劃，我們的資本充足率很高。

(Operator Instructions)

（操作員指示）

Steve Silver, Argus Research Corporation.

史蒂夫‧西爾弗 (Steve Silver)，阿格斯研究公司。

Okay. Thanks for taking the follow up. Okay. Just curious as to your current thinking about how the company is planning on driving product innovation in 2025. You spoke a lot about the healthy food strategy evolving to meet customers' trends and demand. Just curious, your current thinking about the speed at which you're able to bring new innovative products to the product menu.

好的。感謝您的跟進。好的。我只是好奇您目前對公司計劃如何在 2025 年推動產品創新的看法。您談了很多關於為滿足顧客的趨勢和需求而不斷發展的健康食品策略。只是好奇，目前對於將新的創新產品引入產品菜單的速度有何想法？

Okay. Okay. Steve, I'll take that question. Yeah, I mean, as I mentioned, the product innovation remains a core strategic focus for us. Now in 2024, we introduced a total of 92 new products, including 47 beverages and 45 food items. These new products account for approximately 25% of total net revenue.

好的。好的。史蒂夫，我來回答這個問題。是的，正如我所提到的，產品創新仍然是我們的核心策略重點。如今到了2024年，我們共推出了92種新產品，其中包括47種飲料和45種食品。這些新產品約佔總淨收入的25%。

So as a leading coffee brand in China, we commit to provide fresh, healthy and delicious products to our distinct guests. So to achieve that goal, we have spent money, renovating more than 600 stores into made-to-order model last year and (inaudible) in all our beverage and our product offerings.

因此，作為中國領先的咖啡品牌，我們致力於為尊貴的客人提供新鮮、健康和美味的產品。因此，為了實現這一目標，我們投入了大量資金，去年將 600 多家門市改造成客製化模式，並且（聽不清楚）改造了我們所有的飲料和產品。

And going forward, our product innovation will continue to work around these products of freshness and healthiness for our key target customer segments, including white collar, family and fitness enthusiasts. So our coffee plus bagel combo has become a goal to breakfast choice for guests, offering high-quality affordable options that balance taste and nutrition The pattern has become staple for our loyal clientele driven by taste, convenience and value.

展望未來，我們的產品創新將繼續圍繞新鮮和健康的產品展開，面向我們的主要目標客戶群，包括白領、家庭和健身愛好者。因此，我們的咖啡加百吉餅組合已成為客人早餐的目標選擇，提供平衡口味和營養的高品質、實惠的選擇，這種模式已成為我們忠實客戶的主食，以口味、便利和價值為驅動力。

Building on this momentum, we extended the concept to launch with our debut of the light bagel burger lunchbox, a healthy made-to-order new solution that has got a strong market acceptance since it's launch in February. The three item combo, including one bagel sandwich, one slice and one drink sells only from RMB25.8, which is about USD3.5.

在此勢頭的基礎上，我們擴展了這一概念，首次推出了輕便百吉餅漢堡午餐盒，這是一種健康的定制新解決方案，自二月份推出以來就獲得了市場的廣泛認可。這三款套餐包括一個貝果三明治、一片貝果和一杯飲料，售價僅 25.8 元，約 3.5 美元。

So I mean, right now it contributes about 20 transactions per store per day. And as I mentioned, okay, we are going to launch another two waves to further drive the lunch box for us. So I mean, our coffee plus fresh prepared food strategy serves as a key differentiator, allowing us to avoid pricing wars and concentrate on delivering long-term value. And we are confident that our dedication to provide a high-quality and affordable offerings will ultimately enable us to succeed in this non-competitive market.

所以我的意思是，現在它每天為每家商店貢獻大約 20 筆交易。正如我所提到的，好的，我們將推出另外兩波活動來進一步推動我們的午餐盒。所以我的意思是，我們的咖啡加新鮮食品策略是一個關鍵的區別因素，使我們能夠避免價格戰並專注於提供長期價值。我們相信，我們致力於提供高品質且價格合理的產品最終將使我們在這個非競爭性市場中取得成功。

Great. And then you mentioned during your answer about your loyal customers. I'm curious, given the fact that we are now into April of 2025, whether there's any color you can provide directionally about the expansion of the loyalty program without giving any specific numbers just in terms of the trend there, whether it's continuing from 2024 levels?

偉大的。然後您在回答時提到了您的忠實客戶。我很好奇，考慮到現在已經進入 2025 年 4 月，您是否可以提供關於忠誠度計劃擴展的方向性信息，而無需提供任何具體的數字，僅就趨勢而言，它是否會延續 2024 年的水平？

Yeah. I mean it's -- no, the loyalty club members continue to go high day over day. I mean, we have several ways to attract the loyalty club members. First of all, we are continuing to open new stores through a franchising model. And I mean, many new customers will come into our store that become our loyalty club members.

是的。我的意思是──不，忠誠俱樂部的會員們的熱情日復一日地高漲。我的意思是，我們有幾種方法來吸引忠誠俱樂部的會員。首先，我們繼續透過特許經營模式開設新店。我的意思是，許多新顧客會進入我們的商店並成為我們的忠誠俱樂部會員。

Secondly, we have lots of online channels to attract the loyalty club members through to deliver throuht, okay, the cooperations with other aggregators or platforms, et cetera. And thirdly, we usually cross over -- to cross over branding with a lot of good brands like Tesla, like, okay, Lululemon all the good brands in China, which will bring us lots of new club members as well.

其次，我們有許多線上管道來吸引忠誠俱樂部會員，透過與其他聚合器或平台的合作等來實現。第三，我們通常會與許多優秀品牌進行跨界合作，例如特斯拉、Lululemon 等中國所有優秀品牌，這也會為我們帶來許多新的俱樂部成員。

Great, that's very helpful. Thanks again.

太好了，這非常有幫助。再次感謝。

Thank you.

謝謝。

Thank you. There are no further questions at this time. I'll now hand back to the company for any closing remarks.

謝謝。目前沒有其他問題。現在我將把發言權交還給公司，以便大家做最後的總結發言。

Thank you for all your time and let's look forward to, a great year and ahead. Thank you.

感謝您一直以來的時間，讓我們期待美好的一年和未來。謝謝。

Thank you very much.

非常感謝。

Thank you. Bye-bye.

謝謝。再見。

Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.

謝謝。今天的會議就到此結束了。感謝您的參與。您現在可以斷開連線。