THCH · TH International Limited

Tims China navigated a challenging environment in Q4 and full year 2025, posting a 7.3% YoY decline in total revenues to RMB308.5 million, driven primarily by closures of underperforming non-MTO stores and a 1.4% drop in same-store sales for company-owned stores. Despite this, system sales grew 4.0% YoY to RMB359.4 million, reflecting strength in franchised operations and a shift toward higher-performing made-to-order (MTO) formats, with net 17 new stores added in Q4 (40 MTO openings offset by 23 non-MTO closures) and full-year net 25 additions, culminating in 1,047 system-wide stores. Company-owned store revenues fell 8.0% to RMB248.7 million amid an 8.4% drop in average ticket size, though offset partially by 3.0% more orders; contribution margin compressed to 3.7% from 4.8%, pressured by rising delivery costs (up to 13.3% of revenues on higher delivery mix) despite supply chain efficiencies lowering food costs to 29.4%. Other revenues dipped 4.3% to RMB59.8 million due to fewer franchise openings. Management highlighted strategic progress in 'Coffee + Freshly Prepared Food' positioning, near-complete MTO renovations, 29.0% loyalty member growth to 31.0 million, and 55.7% YoY profit growth from other revenues. Cost controls shone through: adjusted G&A expenses fell sharply to 15.8% of revenues, aiding Adjusted Corporate EBITDA loss narrowing to -11.6% margin from -14.9%. CEO Yongchen Lu emphasized transition year achievements including 10,000+ sub-franchisee applications and steady sub-franchise cash flows, while CFO Albert Li noted resilience via efficiencies reducing key cost ratios. Liquidity stood at RMB129.7 million end-2025, down from prior year amid expansion, signaling ongoing investment in unit economics amid macro volatility.