How did Green Hotel's revenue and expenses shift in Q3 2024?

GreenTree Hospitality Group (GHG) experienced a significant decline in revenue and a decrease in expenses in Q3 2024 compared to the same period in the previous year, reflecting challenging market conditions and strategic adjustments.

1. **Revenue Shift**:
- **Total Revenue Decrease**: The company's total revenues decreased by 22.5% year-over-year, amounting to RMB357.0 million (US$50.9 million). This decline is a result of lower hotel and restaurant revenues.
- **Hotel Revenue Impact**: The number of hotels in operation increased to 4,336 with 316,461 rooms. However, the average daily room rate (ADR) fell by 6.0% to RMB181 compared to RMB192 in Q3 2023. The occupancy rate dropped to 74.6% from 81.2%, and the revenue per available room (RevPAR) decreased by 13.6% to RMB135.
- **Restaurant Revenue Impact**: The number of restaurants in operation remained at 182. However, the average check (AC) dropped by 15.9% to RMB46, the average daily tickets (ADT) decreased to 106 from 120, and the average daily sales per store (ADS) fell by 25.6% to RMB4,891.
2. **Expense Shift**:
- **Dividend Payout Ratio**: The company maintained a high dividend payout ratio of 126.19%, indicating a significant portion of earnings is returned to shareholders through dividends.
- **Net Margin and Return on Equity**: Despite the revenue decline, GHG maintained a net margin of 19.47% and a return on equity of 21.03%, reflecting efficient management and profitability.
- **Earnings Per Share (EPS)**: The company reported an EPS of $0.36 for the quarter, which could be influenced by the dividend payments, as the company also announced a variable dividend to be paid on October 23rd.
3. **Strategic Adjustments**: GHG opened 109 hotels and had a pipeline of 1,085 hotels under development, indicating strategic expansion efforts despite the challenging market conditions. The company revised its revenue guidance for the hotel business, anticipating a flat performance for the year 2024 compared to 2023, considering the impact of closing certain leased hotels due to lease expirations and strategic decisions.

In conclusion, GHG faced a tough quarter with revenue declining and ADR, AC, and RevPAR dropping, but managed to maintain profitability and return to shareholders through dividends. The company is focusing on strategic expansions and adjusting its revenue guidance to reflect the current market conditions.