HDL — SUPER HI INTERNATIONAL HOLDING Ltd. American Depositary Shares

HDL Q3 2025 Earnings Call Summary

1. Key Financial Results and Metrics:

• Revenue: USD 214 million, up 7.8% year-over-year.
• Same-store Revenue Growth: 2.3%.
• Operating Profit: USD 12.64 million, down 15.4% from the previous year.
• Operating Profit Margin: 5.9%, a decline of 1.6 percentage points year-over-year.
• Net Profit After Tax: USD 3.59 million, a significant drop from USD 37.6 million last year, primarily due to foreign exchange losses.
• Takeaway Revenue: USD 4.4 million, a 69.2% increase year-over-year.
• Table Turnover Rate: 3.9x overall, with same-store turnover at 4x, both up by 0.1x from last year.

2. Strategic Updates and Business Highlights:

• Continued focus on customer satisfaction and employee benefits led to improved store management and operational results.
• Launched fresh-cut meat offerings in over 60% of stores, achieving an adoption rate exceeding 11%.
• Opened 2 new Haidilao stores in Malaysia and Indonesia, while discontinuing one in Singapore and adjusting another in Thailand.
• The Pomegranate plan for international expansion is progressing, with the Hi Bowl brand in Canada becoming profitable.
• New store formats, including a BBQ concept in Indonesia and an Izakaya in Japan, are being tested.

3. Forward Guidance and Outlook:

• Anticipation of opening several new stores in Q4, aiming for a total of over 10 new locations for the year.
• Q4 is expected to be a peak season, with a forecasted increase in table turnover rates and operating margins.
• Management emphasizes a cautious approach to expansion, focusing on quality over quantity in new store openings.

4. Bad News, Challenges, or Points of Concern:

• Operating profit decreased significantly year-over-year, raising concerns about management efficiency.
• Foreign exchange losses impacted net profit, highlighting vulnerability to currency fluctuations.
• Average order value declined by USD 1.2, attributed to pricing adjustments and discount strategies, which may affect long-term profitability.
• Employee turnover, while improved, remains a concern in maintaining operational consistency.

5. Notable Q&A Insights:

• Management is adapting strategies regionally, focusing on local market conditions and customer preferences.
• Profit margins are not set as short-term targets; instead, management prioritizes customer satisfaction and operational quality.
• Employee satisfaction initiatives have led to a reduction in turnover rates, indicating positive outcomes from recent changes.
• Future expansion will be cautious, with a focus on thorough market research and site selection to ensure high-quality store openings.

Overall, while HDL shows growth in revenue and customer traffic, it faces challenges in profitability and operational efficiency that management is actively addressing through strategic initiatives and careful expansion planning.