Haidilao's 2025 revenue increased slightly by 1.1%, net profit declined by 14% under pressure, takeaway business income more than doubled | Earnings Report Insights

Facing a fiercely competitive restaurant market and a sluggish consumer environment, Haidilao managed to maintain its foundation in 2025. On Tuesday, Haidilao released its full-year 2025 earnings report: total revenue reached 43.225 billion yuan, a year-on-year increase of 1.1%. However, profits were under significant pressure—core operating profit (non-IFRS) fell 13.3% year-on-year to 5.403 billion yuan, and net profit dropped 14.0% to 4.042 billion yuan. The main reason for the profit decline is the continued decrease in table turnover rates. In 2025, the overall table turnover rate for Haidilao's self-operated restaurants was 3.9 times/day, down from 4.1 times/day in 2024. Total customers served throughout the year decreased 7.5% year-on-year to 383.9 million. Meanwhile, the group increased investments in product innovation and scenario upgrades, which drove up raw material and other operating costs, resulting in a double squeeze on profits. Despite this, the group saw frequent highlights in structural transformation. Delivery business income surged 111.9% year-on-year to 2.658 billion yuan. Income from other restaurant brands under the "Red Pomegranate Project" grew 214.6% year-on-year to 1.521 billion yuan. Franchise business revenue jumped from 16.71 million yuan to 270 million yuan. Diversified income sources are growing rapidly. The board recommends a final dividend of HK$0.384 per share, showing confidence in future operations. Revenue Structure: Core Business Shrinks, New Business Rapidly Fills the Gap In 2025, total operating income from Haidilao restaurants (including self-operated and other restaurants) was about 40.584 billion yuan. However, operating income from self-operated Haidilao restaurants declined from 40.4 billion yuan to 37.543 billion yuan, a decrease of 7.1%, mainly due to lower table turnover rates and a reduction in self-operated store numbers (some converted to franchise). In stark contrast, emerging business sectors saw strong growth: Delivery business: Revenue of 2.658 billion yuan, up 111.9% year-on-year, contributing 6.1% of total revenue (up from 2.9%). The "Side dishes" business is the main driver, with over 1,200 delivery outlets nationwide. Other restaurant operations (brands under Red Pomegranate Project): Revenue of 1.521 billion yuan, up 214.6% year-on-year, share rising from 1.1% to 3.5%. Seasonings and ingredient sales: Revenue of 1.155 billion yuan, up 100.8%. Franchise business: Revenue of 270 million yuan, up sharply, with the number of franchise restaurants rising from 13 to 79. Combined, new businesses now contribute about 13.1% of total revenue, up from roughly 5.5%. The group’s income structure is undergoing a substantial transformation. Table Turnover & Same-Store Sales: Across-the-Board Pressure, Hong Kong-Macau-Taiwan Steady Table turnover rate is a core indicator of Haidilao's operating quality. The 2025 figures are alarming. By city tier, turnover rates in tier 1, 2, and 3+ cities were each 3.9 times/day, all declining from 2024 figures of 4.0, 4.1, and 4.0 respectively, with tier 2 cities seeing the biggest drop. Hong Kong-Macau-Taiwan maintained a stable rate of 4.3 times/day, the only region that did not drop. Same-store sales data is also unoptimistic. The average daily sales of 1,135 same stores fell from 852,000 yuan to 795,000 yuan. Total same-store sales dropped from 35.269 billion yuan to 32.895 billion yuan, a decrease of about 6.7%. For tier 2 cities, average daily same-store sales declined from 839,000 yuan to 762,000 yuan, showing the largest decrease. Per-customer spending remained relatively stable, rising slightly from 97.5 yuan to 97.7 yuan. Mainland China restaurants maintained 95.7 yuan. This shows that average ticket price was not the drag—the core problem was declining customer traffic. Cost Structure: Increase in Raw Material Cost Ratio; Depreciation Pressure Relieved In 2025, costs showed divergent trends: Raw materials & consumables: From 16.211 billion yuan up to 17.526 billion yuan, ratio to revenue increased from 37.9% to 40.5%. The rise is mainly due to two reasons: first, higher proportion of non-core business income (delivery, other restaurants), which have relatively higher raw material costs; second, the group optimized dish structure and launched fresh-cut series/high-quality ingredients, lifting ingredient costs. Employee costs: Slightly down from 14.113 billion yuan to 14.073 billion yuan, ratio to revenue fell from 33.0% to 32.6%. Total employees: 125,620. Cost control remained stable. Depreciation & amortization: Dropped sharply from 25.585 billion yuan to 21.821 billion yuan—a 14.7% decrease, ratio fell from 6.0% to 5.0%, mainly because previous restaurant assets are now fully depreciated. This is a major positive for the profit side. Other expenses: From 18.641 billion yuan up to 22.701 billion yuan, ratio increased from 4.4% to 5.3%, mainly due to higher platform fees and promotional expenses for delivery (+2.942 billion yuan), as well as higher administration/storage expenses. Multi-Brand Strategy: "Red Pomegranate Project" Moves to Market Expansion Stage 2025 was a pivotal year for Haidilao’s multi-brand strategy. By year-end, the group operated 20 sub-brands with 207 restaurants, covering seafood stalls, sushi, western light meals, mini hot pot, and Chinese fast food. The group has reorganized the incubation mechanism for the "Red Pomegranate Project," introducing a dual-track system of "Chef Entrepreneurs" (employee-driven startups) and "Popular Restaurants" (headquarters-driven incubation). The former boosts internal entrepreneurship—while the latter expands market coverage across categories and tiers. Financially, revenue from other restaurant operations jumped from 483 million yuan to 1.521 billion yuan—an increase of over 200%, confirming the initial effectiveness of the multi-brand strategy. The group also stated it would strategically pursue acquisitions of quality assets to further diversify its restaurant business. As of December 31, 2025, Haidilao operated 1,383 restaurants under its brand: 1,304 self-operated (79 newly opened in the year, 85 closed/moved, and 45 converted to franchise); 79 franchised (21 newly opened in the year). Self-operated stores net decreased by 51 (from 1,355 in 2024), franchise stores expanded from 13 to 79. Geographically, Mainland China had 1,281 self-operated stores, with tier 3+ cities accounting for the largest share (571 stores). Hong Kong-Macau-Taiwan stayed at 23 stores. Systemwide sales (including franchise) dropped 3.7% year-on-year, reflecting ongoing network sales pressure. Shareholder Returns: Dividend of HK$0.384 per share As of December 31, 2025, the group’s bank balances and cash were 6.602 billion yuan (including time deposits), down from 7.475 billion yuan in 2024, and cash/cash equivalents fell from 6.407 billion yuan to 3.951 billion yuan—mainly used for dividend payouts, capital expenditures, and operations. On the liability side, the 2026 priority notes (principal US$2.8548 billion) were fully repaid on January 14, 2026, greatly reducing long-term debt pressure. Capital-to-debt ratio was 24.3%. Overall, the financial structure remains solid. Inventory turnover days improved from 24.0 to 22.3 days, indicating improved operational efficiency. During the reporting period, the group distributed a total of about 4.195 billion yuan in interim and final dividends to shareholders (including 2024 final dividend), and proposes to pay a 2025 final dividend of HK$0.384/share, totaling about HK$2.08 billion, maintaining strong shareholder returns. 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