BRIEF: Fresh food model lifts Jiumaojiu’s Tai Er back to same-store sales growth

Jiumaojiu International Holdings Ltd. (9922.HK) said average daily sales at its flagship Tai Er restaurant chain fell 3% year-on-year in the fourth quarter, narrowing from a 9.3% decline the previous quarter, while the chain returned to positive same-store sales growth in China, according to a fourth-quarter operating update released on Friday.

According to the report, daily table turnover at self-operated Tai Er restaurants stood at 3.0 times in the fourth quarter, down from 3.3 times in the third quarter, while average spending per customer rose to 77 yuan ($11), compared with 74 yuan in the previous quarter. Jiumaojiu said the return to positive growth for average daily same-store sales at Tai Er in China reflected the effectiveness of earlier operational adjustments and store model upgrades.

Stores operating under the company’s “Fresh” model, providing freshly prepared fish to customers, delivered particularly strong results, with Tai Er now using the model at 243 stores in 60 cities nationwide.

The company’s other major brands, Song Hot Pot and Jiu Mao Jiu, recorded year-on-year same-store average daily sales declines of 19% and 16.4%, respectively, during the fourth quarter. Jiumaojiu operated 644 restaurants at the end of last year, a net reduction of 42 outlets from the end of September, including 499 Tai Er restaurants, 62 Song Hot Pot outlets and 63 Jiu Mao Jiu restaurants.

Jiumaojiu’s stock opened higher on Monday and closed at HK$1.92 by the midday break, up 2.67%.

By Lee Shih Ta

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