Seeks Faster Growth through Franchise & Multi-Brand Strategy

Results Highlights

• Group's revenue grew 10.0% to HK$1,387.4 million, driven by 14 net openings in restaurant network and moderate comparable restaurant revenue growth in Hong Kong
• Profit for the period excluding government subsidies⁽¹⁾ increased by 153.1% to HK$81.4 million
• Operating profit margin⁽²⁾ in Hong Kong stood high at 20.2%
• Narrowed operating loss⁽²⁾ outside Hong Kong by 68.3% to HK$5.3 million
• Exploring franchise arrangements to enter Australia and the Philippines, and brand diversification in Hong Kong
• The Board has resolved to declare an interim dividend of HK3.0 cents per share (1H2023: Nil)

Notes: (1) This is a non-HKFRS measure, defined as profit for the relevant period deducting government subsidies, which are non-recurring income.(2) This is a non-HKFRS measure, defined as revenue less restaurant and central kitchen costs and excluding costs attributable to headquarters and office. HONG KONG SAR - Media OutReach - 14 November 2023 - Tam Jai International Co. Limited ("TJI" or the "Company", and together with its subsidiaries, the "Group"; HKEX stock code: 2217), one of the leading and renowned restaurant groups in Hong Kong, today announced its interim results for the six months ended 30 September 2023 ("1H2024" or the "Period"). With new opportunities arising from the end of the pandemic, the Group has emerged stronger and delivered solid year-on-year ("YoY") revenue growth of 10.0% to HK$1,387.4 million in 1H2024, driven by the net additions of 14 restaurants into its network and moderate comparable restaurant revenue growth in Hong Kong. During the Period, the Group reported a narrowed operating loss⁽²⁾ at the restaurant level for the combined markets outside of Hong Kong, down by 68.3% YoY to HK$5.3 million, mainly driven by the improved business performance in Mainland China and Japan. Despite global cost inflation, the Group effectively maintained stable cost-to-revenue ratios for its food, staff and rental expenses, thanks to its streamlined workflows, agility in supply chain management, stringent cost control, as well as dedicated efforts in stabilising frontline workforce. The operating profit margin⁽²⁾ of the Group's restaurant operations increased to 18.5% in 1H2024. Profit for the period excluding government subsidies⁽¹⁾ increased significantly by 153.1% YoY to HK$81.4 million. Profit for the period was HK$81.6 million in 1H2024, similar to that for the six months ended 30 September 2022 ("1H2023"). To share success with the Company's shareholders, the Board has resolved to declare an interim dividend of HK3.0 cents per share for 1H2024 (1H2023: Nil), representing a payout ratio of approximately 49.2%. Hong Kong Market Keeps Growing The Group demonstrated agile, resilient, and innovative management, allowing it to maintain its prominent market position and achieve steady growth before, during, and even after the pandemic. In the past five financial years ended 31 March 2023 ("FY2023"), the Group reported a compounded annual revenue growth (CAGR) of 12.0% in Hong Kong. In 1H2024, the Group's revenue in Hong Kong recorded a further growth of 8.2% YoY to HK$1,296.1 million, driven by the improved comparable restaurant revenue performance since the fourth quarter of FY2023, where a YoY increase of 2.9% has been recorded for 1H2024. Notable improvement was observed in commercial areas as a result of the growing number of commuters returning to their physical offices after the pandemic. To drive further growth on the enlarged revenue base, the Group strategically expanded its product offerings with the introduction of the afternoon tea set "Me More Tea Set" in July 2023, capitalising on traditionally less busy periods and expanding its target customers to a wider base of demographics. Besides, the Group extended the business hours of its restaurants, launched attractive promotions, and engaged a new aggregator, KeeTa, to grow its comparable restaurant revenue. There were two net openings in 1H2024, with the total number of restaurants reaching 184 as of 30 September 2023. During 1H2024, the operating profit margin⁽²⁾ of the Group's Hong Kong business improved to 20.2% (1H2023: 19.4%). This achievement further solidifies TJI's position as one of the leading players in the food and beverages ("F&B") sector in Hong Kong. Narrowed Losses outside Hong Kong In view of challenging conditions in Shenzhen due to economic slowdown, the Group made a strategic move to redirect its expansion focus to Guangzhou and other second-tier cities in the Greater Bay Area ("GBA") in Mainland China in 1H2024. During the Period, it opened seven new restaurants in Mainland China, primarily located in Guangzhou, Dongguan, Zhongshan, and Zhuhai, while closed three underperforming stores in Shenzhen. The new restaurants, with lower operating costs, demonstrated satisfactory financial performance,...