6-K - GHG - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

July 2021

Commission File Number: 001-38425

GreenTree Hospitality Group Ltd.

(Registrant’s name)

2451 Hongqiao Road, Changning District

Shanghai 200335

People’s Republic of China

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F x Form 40-F ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1) : ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7) : ¨

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

GREEN TREE HOSPITALITY GROUP LTD .
By:	/s/ Alex S. Xu
Name:	Alex S. Xu
Title:	Chairman and Chief Executive Officer

Date: July 29, 2021

EXHIBIT INDEX

Exhibit No.	Description
99.1	GreenTree Hospitality Group Ltd. Reports First Quarter 2021 Financial Results

Exhibit 99.1

GreenTree Hospitality Group Ltd. Reports FirstQuarter 2021 Financial Results

·	Total revenues increased 53.3% year-over-year to RMB241.2 million (US$36.8 million) ^[1]^.
·	Incomefrom operations increased 64.9% year-over-year to RMB61.4 million (US$9.4 million) ^[1]^.
---	---
·	AdjustedEBITDA (non-GAAP) ^[2]^ increased 74.3% year-over-year to RMB64.0 million (US$9.8 million) ^[1]^.
---	---
·	Corenet income (non-GAAP) increased 58.3% year-over-year to RMB43.9 million (US$6.7 million) ^[1]^.
---	---

SHANGHAI, July 29, 2021 /PRNewswire/ -- GreenTree Hospitality Group Ltd. (NYSE: GHG) (“GreenTree”, the “Company”, “we”, “us” and “our”), a leading hospitality management group in China, today announced its unaudited financial results for the first quarter and fiscal year of 2021.

First Quarter of 2021 Operational Highlights

·	A<br>total of 4,464 hotels with 323,648 hotel rooms were in operation as of March 31, 2021, compared to 4,340 hotels and 315,335 hotel rooms<br>as of December 31, 2020.
·	As<br>of March 31, 2021, the Company had 43 leased-and-operated ("L&O") hotels and 4,421 franchised-and-managed ("F&M")<br>hotels in operation in 353 cities across China, compared to 35 L&O hotels and 3,963 F&M hotels in operation in 342 cities as<br>of March 31, 2020. The geographic coverage increased by 3.2% year over year.
---	---
·	During the quarter, the Company opened 201 hotels, an increase of 139 compared to 62 hotels in the first quarter of 2020. Three of those hotels were in the luxury segment, 32 in the mid-to-up-scale segment, 136 in the mid-scale segment, and 30 in the economy segment. Geographically speaking, 9 hotels were in Tier 1 cities ^[3]^, 65 in Tier 2 cities and the remaining 127 in Tier 3 and lower cities in China.<br><br> <br><br><br> <br>The Company closed 77 hotels, 6 due to brand upgrades, and 30 due to non-compliance with the Company's brand and operating standards. The remaining 41 were closed for property related issues. The Company added 124 hotels to its portfolio.
---	---
·	As<br>of March 31, 2021, the Company had a pipeline of 1,265 hotels contracted for or under development, among which 53 hotels were in the<br>luxury hotel segment, 291 in the mid-to-up-scale segment, 516 in the mid-scale segment, and 405 in the economy segment.
---	---
·	The<br>average daily room rate, or ADR, for all hotels in operation, was RMB 151, an increase of 0.8% from RMB150 in the first quarter of 2020,<br>and a 7.0% decrease compared with RMB162 in the pre-COVID-19 first quarter of 2019.
---	---
·	The<br>occupancy rate, or OCC for all hotels in operation was 63.4%, an increase of 16.1% compared with 47.3% in the first quarter of 2020,<br>and a 14.7% decrease compared with 78.1% in the pre-COVID-19 first quarter of 2019.
---	---
·	The<br>revenue per available room, or RevPAR, which is calculated by multiplying our hotels' ADR by its occupancy rate, was RMB 96, a 35.1%<br>year-over-year increase, and a 24.5% decrease compared with RMB127 in the pre-COVID-19 first quarter of 2019.
---	---
·	As<br>of March 31, 2021, the Company's loyalty program had more than 59 million individual members and more than 1,710,000 corporate members,<br>compared to over 56 million individual members and approximately 1,670,000 corporate members respectively as of December 31, 2020. The<br>Company sold approximately 92.2% of room nights directly during the first quarter 2021.
---	---
1	The<br> conversion of Renminbi ("RMB") into United States dollars ("US$") is<br> based on the exchange rate of US$1.00=RMB6.5518 on March 31, 2021 as set forth in H.10 statistical<br> release of the U.S. Federal Reserve Board and available at https://www.federalreserve.gov/releases/h10/20210405/
---	---
2	Adjusted<br> EBITDA (non-GAAP) is calculated as net income plus other operating expenses, income tax expense,<br> interest expense, depreciation and amortization, losses from investment in equity securities,<br> share of loss in equity investees (net of tax), but excludes other operating income, interest<br> income and other, net, gains from investment in equity securities, share of gain in equity<br> investees (net of tax). The calculation of Adjusted EBITDA (non-GAAP)<br> included in this report has been aligned according to the abovementioned definition.
---	---
3	Tier<br> 1 Cities refers to Beijing, Shanghai, Shenzhen and Guangzhou; Tier 2 Cities refers to the<br> 32 major cities, other than Tier 1 Cities, including provincial capitals, administrative<br> capitals of autonomous regions, direct-controlled municipalities and other major cities designated<br> as municipalities with independent planning by the State Council.
---	---

“We achieved steady growth during the first quarter and continued to recover from the pandemic despite the resurgence of COVID-19 in many regions of China” said Mr. Alex Xu, Chairman and Chief Executive Officer of Greentree. “As the year unfolds, we remain very focused on our growth strategy which covers three particular areas. First, we are adding L&O hotels in strategic locations, second, we are further expanding in tier 3 and lower cities and, third, we are further penetrating the Mid-to-Upscale segment. We are optimistic that travel will continue to recover as vaccine rollouts accelerate. This should translate into even better results next quarter. On behalf of our Board, I want to thank our team, franchisees and shareholders for their tremendous efforts and support.”

First Quarter of 2021 Financial Results

	Quarter Ended
	March 31, 2020		March 31, 2021		March 31, 2021
	RMB		RMB		US
Revenues
Leased-and-operated hotels		33,800,144		56,113,308
Franchised-and-managed hotels		117,663,102		177,949,627
others		5,932,745		7,149,523
Total revenues		157,395,991		241,212,458

All values are in US Dollars.

Total revenues were RMB241.2 million (US$36.8 million) ^[1]^, a 53.3% year-over-year increase. The increase was primarily due to the sustained recovery in hotel operations from the impact of COVID-19 and our newly opened L&O hotels. Compared with the pre-COVID-19 first quarter of 2019, total revenues increased by 2.5%.

Total revenues fromleased-and-operated hotels were RMB56.1 million (US$8.6 million) ^[1]^, a 66.0% year-over-year increase. The increase was primarily due to the 71.7% year-over-year increase in L&O hotels’ RevPAR and revenues from the 12 L&O hotels opened since the second quarter of 2020. The revenue increase was partially offset by the closure of 4 L&O hotels over the same period.

Total revenues from franchised-and-managedhotels were RMB177.9 million (US$27.2 million) ^[1]^, a 51.2% year-over-year increase. Initial franchise fees increased by 37.7% year-over-year, mainly attributable to the gross opening of 198 F&M hotels. Recurring franchisee management fees and others increased 52.9% year-over-year primarily due to the 34.3% increase in RevPar and the 11.6% increase in the number of F&M hotels, and was offset by the fee reduction to franchisees during the first quarter 2021.

	Quarter Ended
	March 31, <br><br>2020		March 31, <br><br>2021		March 31, <br>2021
	RMB		RMB		US
Initial franchise fee		13,052,832		17,978,858
Recurring franchise management fee and others		104,610,270		159,970,769
Revenues from franchised-and-managed hotels		117,663,102		177,949,627

All values are in US Dollars.

Total operating costs and expenses

	Quarter Ended
	March 31, <br><br>2020		March 31,<br><br> 2021		March 31, <br>2021
	RMB		RMB		US
Operating costs and expenses
Hotel operating costs		89,763,273		122,230,252
Selling and marketing expenses		17,841,322		18,118,110
General and administrative expenses		28,745,571		55,958,157
Other operating expenses		1,157,149		1,393,556
Total operating costs and expenses		137,507,315		197,700,075

All values are in US Dollars.

Hotel operating costs were RMB122.2 million (US$18.7 million) ^[1]^, a 36.2% increase year over year. The increase was mainly attributable to higher rents due to the opening of 12 L&O hotels since the second quarter of 2020. Excluding these, hotel operating costs increased 17.9%, mainly due to increase in staff number and staff salaries.

	Quarter<br> Ended
	March 31,		March 31,		March 31,
	2020		2021		2021
	RMB		RMB		US
Rental		27,102,982		39,720,751
Utilities		4,420,190		5,896,419
Personnel cost		10,230,645		13,653,447
Depreciation and amortization		11,338,835		16,167,503
Consumable, food and beverage		8,750,868		11,339,390
Costs of general managers of franchised-and-managed<br> hotels		20,642,648		27,318,710
Other costs of franchised-and-managed<br> hotels		4,503,060		5,541,994
Others		2,774,046		2,592,039
Hotel Operating<br> Costs		89,763,273		122,230,252

All values are in US Dollars.

Selling and marketing expenses were RMB18.1 million (US$2.8 million) ^[1]^, a 1.6% year-over-year increase. The increase was mainly attributable to increases in advertising expenses.

General and administrative expenses were RMB56.0 million (US$8.5 million) ^[1]^, a 94.7% year-over-year increase. The increase was mainly attributable to increased consulting fees and other one-time expenses. Excluding these impacts, G&A expenses increased by 40.0% as a result of the increase in the number of staff.

Gross profit was RMB119.0 million (US$18.2 million) ^[1]^, a year-over-year increase of 75.9%. Gross margin was 49.3%, compared to 43.0% a year ago. The increase was primarily due to the recovery in our hotel RevPAR from COVID-19.

Income from operations were RMB61.4 million (US$9.4 million) ^[1]^, a year-over-year increase of 64.9%. The increase was mainly due to the sustained recovery in RevPar, the higher number of hotels and better control of costs and expenses during the quarter. Operating margin was 25.4%, compared to 23.6% a year ago.

Net income was RMB66.0 million (US$10.1 million) ^[1]^, compared to a loss of RMB14.1 million in the first quarter of 2020 and net margin was 27.4%.The year-over-year increase was mainly attributable to the recovery in RevPAR.

Adjusted EBITDA (non-GAAP) ^[2]^ was RMB64.0 million (US$9.8 million) ^[1]^, a year-over-year increase of 74.3%. Adjusted EBITDA margin, defined as adjusted EBITDA (non-GAAP) as a percentage of total revenues, was 26.5%, compared to 23.3% a year ago.

Core net income (non-GAAP) was RMB43.9 million (US$6.7 million) ^[1]^, a year-over-year increase of 58.3%. The core net margin, defined as core net income (non-GAAP) as a percentage of total revenues, was 18.2%, compared to 17.6% one year ago.

Earnings per ADS (basic and diluted) was RMB0.68 (US$0.10) ^[1]^, up from negative RMB0.11 one year ago.Core net income per ADS (basic and diluted) (non-GAAP) was RMB0.43 (US$0.07) ^[1]^, up from RMB0.27 a year ago.

Cash flow. Operating cash outflow was RMB1.7 million (US$0.3 million) ^[1]^ as a result of income from operations but offset by prepaid rents for L&O hotels and deposit. Investing cash outflow was RMB 258.2 million (US$39.4 million) ^[1]^, which was primarily attributable to loans to franchisees, increase in long-term time deposits, acquisition costs of our L&O hotels, and investment in property and equipment. The investing cash outflow was partially offset by proceeds from short-term investments. Financing cash inflow was RMB136.1 million (US$20.8 million).

Cash and cash equivalents, restricted cash,short-term investments, investments in equity securities and time deposit. As of March 31, 2021, the Company had total cash and cash equivalents, restricted cash, short term investments, investments in equity securities and time deposits of RMB1,734.0 million (US$264.7 million) ^[1]^, compared to RMB1,904.9 million as of December 31, 2020. The decrease from the fourth quarter was primarily attributable to loans to franchisees and acquisition costs of our L&O hotels, offset by drawing down of bank facilities.

COVID-19 Update

Due to the implementation of travel restrictions and the government’s stay-local policy during the Chinese spring festival, our occupancy rate declined in January and February 2021, but rebounded quickly after this as more people are getting vaccinated and more pent-up demand in China as travel restrictions are lifted. We saw a substantial month over month increase in RevPAR in March, April and May, especially during the Tomb Sweeping holiday and Golden Week. As we expected, these holidays really ushered in a resurgence in travel with 230 million domestic tourists traveling during Golden Week. According to report from the Ministry of Culture and Tourism, this represents 103.2% of the number of domestic tourists in the same period in 2019 and a year-over-year growth of 119.7%. By the end of June, our RevPAR had recovered to 106.0% of the 2019 level. Based upon industry data, our performance and recovery exceeded that of most of our peers.

Guidance

So far, our operations are in line with our previous forecast. Assuming the pandemic remains under control in China in the coming quarters, the Company expects an increase in total revenues of 48%-53% for the full year 2021, compared to 2020 and an increase in total revenues of 25%-30% for the full year 2021, compared to 2019.

The guidance set forth above reflects the Company's current and preliminary views based on our recovery speed and may not be indicative of the final financial results for future interim periods and the full year.

Conference Call

GreenTree's management will hold an earnings conference call at 9:00PM U.S. Eastern Time on July 28, 2021 (9:00 AM Beijing/Hong Kong Time on July 29, 2021).

Dial-in numbers for the live conference call are as follows:

International	1-412-902-4272
Mainland China	4001-201-203
US	1-888-346-8982
Hong Kong	800-905-945 or 852-3018-4992
Singapore	800-120-6157

Participants should ask to join the GreenTree call, please dial in approximately 10 minutes before the scheduled time of the call.

A telephone replay of the call will be available after the conclusion of the conference call until August 4, 2021.

Dial-in numbers for the replay are as follows:

International Dial-in	1-412-317-0088
U.S. Toll Free	1-877-344-7529
Canada Toll Free	855-669-9658
Passcode:	10157730

Additionally, a live and archived webcast of this conference call will be available at http://ir.998.com.

Use of Non-GAAP Financial Measures

We believe that Adjusted EBITDA and core net income, as we present it, is a useful financial metric to assess our operating and financial performance before the impact of investing and financing transactions, income taxes and certain non-core and non-recurring items in our financial statements.

The presentation of Adjusted EBITDA and core net income should not be construed as an indication that our future results will be unaffected by other charges and gains we consider to be outside the ordinary course of our business.

The use of Adjusted EBITDA and core net income has certain limitations because it does not reflect all items of income and expenses that affect our operations. Items excluded from Adjusted EBITDA and core net income are significant components in understanding and assessing our operating and financial performance. Depreciation and amortization expense for various long-term assets, income tax and share-based compensation have been and will be incurred and are not reflected in the presentation of Adjusted EBITDA. Each of these items should also be considered in the overall evaluation of our results. Additionally, Adjusted EBITDA and core net income does not consider capital expenditures and other investing activities and should not be considered as a measure of our liquidity. We compensate for these limitations by providing the relevant disclosure of our depreciation and amortization, interest expense/income, gains/losses from investments in equity securities, income tax expenses, share-based compensation, share of loss in equity investees, government subsidies and other relevant items both in our reconciliations to the corresponding U.S. GAAP financial measures and in our consolidated financial statements, all of which should be considered when evaluating our performance.

The term Adjusted EBITDA and core net income is not defined under U.S. GAAP, and Adjusted EBITDA and core net income is not a measure of net income, operating income, operating performance or liquidity presented in accordance with U.S. GAAP. When assessing our operating and financial performance, you should not consider this data in isolation or as a substitute for our net income, operating income or any other operating performance measure that is calculated in accordance with U.S. GAAP. In addition, our Adjusted EBITDA and core net income may not be comparable to Adjusted EBITDA and core net income or similarly titled measures utilized by other companies since such other companies may not calculate Adjusted EBITDA and core net income in the same manner as we do.

Reconciliations of the Company’s non-GAAP financial measures, including Adjusted EBITDA and core net income, to the consolidated statement of operations information are included at the end of this press release.

About GreenTree Hospitality Group Ltd.

GreenTree Hospitality Group Ltd. ("GreenTree" or the "Company") (NYSE: GHG) is a leading hospitality management group in China. As of March 31, 2021, GreenTree had a total number of 4,464 hotels. In 2019, GreenTree ranked among the Top 12 worldwide in terms of number of hotels in “World's Largest Hotel Companies: HOTELS' 325”, published by HOTELS magazine, and was as well the fourth largest hospitality company in China in 2020 based on the statistics issued by the China Hospitality Association.

GreenTree has built a strong suite of brands including its flagship "GreenTree Inns" brand as a result of its long-standing dedication to the hospitality industry in China and consistent quality of its services, signature hotel designs, broad geographic coverage and convenient locations. GreenTree has further expanded its brand portfolio into mid-to-up-scale and luxury segments through a series of strategic investments. By offering diverse brands, through its strong membership base, expansive booking network, superior system management with moderate charges, and fully supported by its operating departments including Decoration, Engineering, Purchasing, Operation, IT and Finance, GreenTree aims to keep closer relationships with all of its clients and partners by providing a brand portfolio that features comfort, style and value.

For more information on GreenTree, please visit http://ir.998.com

Safe Harbor Statements

This press release contains forward-looking statements made under the "safe harbor" provisions of Section 21E of the Securities Exchange Act of 1934, as amended, and the U.S. Private Securities Litigation Reform Act of 1995. In some cases, these forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to," "confident," "future," or other similar expressions. GreenTree may also make written or oral forward-looking statements in its reports filed with or furnished to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Any statements that are not historical facts, including statements about or based on GreenTree's current beliefs, expectations, assumptions, estimates and projections about us and our industry, are forward-looking statements that involve known and unknown factors, risks and uncertainties that may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. Such factors and risks include, but not limited to the following: GreenTree's goals and growth strategies; its future business development, financial condition and results of operations; trends in the hospitality industry in China and globally; competition in our industry; fluctuations in general economic and business conditions in China and other regions where we operate; the regulatory environment in which we and our franchisees operate; and assumptions underlying or related to any of the foregoing. You should not place undue reliance on these forward-looking statements. Further information regarding these and other risks, uncertainties or factors is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided, including the forward-looking statements made, in this press release are current as of the date of the press release. Except as required by law, GreenTree undertakes no obligation to update any such information or forward-looking statements to reflect events or circumstances after the date on which the information is provided or statements are made, or to reflect the occurrence of unanticipated events.

---Financial Tables and Operational Data Follow—

GreenTree HospitalityGroup Ltd.

UnauditedCondensed Consolidated Balance Sheets

	December 31,		March 31,		March 31,
	2020		2021		2021
	RMB		RMB		US
ASSETS
Current assets:
Cash and cash equivalents		611,358,209		487,966,856
Short-term investment		301,983,182		515,447,537
Investments in equity securities		242,378,696		250,459,364
Accounts receivable, net of allowance		101,511,057		106,403,840
Amounts due from related parties		9,770,871		44,018,293
Prepaid rent		13,597,867		21,703,579
Inventories		3,804,680		2,631,703
Other current assets		77,649,794		197,327,460
Loans receivable, net		222,244,629		270,721,404
Total current assets		1,584,298,985		1,896,680,036
Non-current assets:
Restricted cash		22,369,900		22,369,900
Long-term time deposits		490,000,000		200,000,000
Loan receivable, net		145,703,988		242,149,315
Property and equipment, net		668,605,661		728,286,926
Intangible assets, net		491,513,073		490,171,550
Goodwill		100,231,487		100,231,487
Long-term investments		369,525,917		390,838,455
Other assets		66,635,394		112,912,719
Deferred tax assets		156,070,112		147,935,125
TOTAL ASSETS		4,094,954,517		4,331,575,513
LIABILITIES AND EQUITY
Current liabilities:
Short-term bank loans		150,000,000		280,000,000
Accounts payable		19,606,344		21,412,026
Advance from customers		34,305,508		30,051,962
Amounts due to related parties		3,198,253		3,299,440
Salary and welfare payable		51,567,587		52,241,724
Deferred rent		1,356,132		1,728,841
Deferred revenue		221,314,997		222,478,868
Accrued expenses and other current liabilities		300,696,673		326,435,111
Income tax payable		87,483,970		92,472,787
Total current liabilities		869,529,464		1,030,120,759
Deferred rent		28,642,973		32,505,167
Deferred revenue		361,901,369		346,072,720
Other long-term liabilities		115,862,713		127,274,124
Deferred tax liabilities		178,413,413		177,698,895
Unrecognized tax benefits		290,679,902		296,322,373
TOTAL LIABILITIES		1,845,029,834		2,009,994,038
Shareholders’ equity:
Class A ordinary shares		222,587,070		222,587,070
Class B ordinary shares		115,534,210		115,534,210
Additional paid-in capital		1,149,280,404		1,149,698,243
Retained earnings		570,042,924		639,954,162
Accumulated other comprehensive income		45,586,647		48,017,408
Total GreenTree Hospitality Group Ltd. shareholders’ equity		2,103,031,255		2,175,791,093
Non-controlling interests		146,893,428		145,790,381
Total shareholders’ equity		2,249,924,683		2,321,581,474
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		4,094,954,517		4,331,575,513

All values are in US Dollars.

GreenTreeHospitality Group Ltd.

Unaudited Condensed ConsolidatedStatements of Comprehensive Income

	Quarter Ended
	March 31, 2020			March 31, 2021			March 31, 2021
	RMB			RMB			US
Revenues
Leased-and-operated hotels		33,800,144			56,113,308
Franchised-and-managed hotels		117,663,102			177,949,627
Others		5,932,745			7,149,523
Total revenues		157,395,991			241,212,458
Operating costs and expenses
Hotel operating costs		(89,763,273	)		(122,230,252	)		)
Selling and marketing expenses		(17,841,322	)		(18,118,110	)		)
General and administrative expenses		(28,745,571	)		(55,958,157	)		)
Other operating expenses		(1,157,149	)		(1,393,556	)		)
Total operating costs and expenses		(137,507,315	)		(197,700,075	)		)
Other operating income		17,330,931			17,872,403
Income from operations		37,219,607			61,384,786
Interest income and other, net		10,613,260			15,131,096
Interest expense		(1,010,255	)		(3,388,211	)		)
(Losses)Gains from investment in equity securities		(55,174,918	)		27,724,291
Income before income taxes		(8,352,306	)		100,851,962
Income tax expense		(6,177,560	)		(35,206,811	)		)
Income (loss) before share of loss in equity investees		(14,529,866	)		65,645,151
Share of gains in equity investees, net of tax		394,844			379,566
Net income		(14,135,022	)		66,024,717
Net loss attributable to non-controlling interests		2,289,368			3,886,521
Net income attributable to ordinary shareholders		(11,845,654	)		69,911,238
Net earnings per share
Class A ordinary share-basic and diluted		(0.11	)		0.68
Class B ordinary share-basic and diluted		(0.11	)		0.68
Net earnings per ADS
Class A ordinary share-basic and diluted		(0.11	)		0.68
Class B ordinary share-basic and diluted		(0.11	)		0.68
Weighted average shares outstanding
Class A ordinary share-basic		68,286,954			68,286,954
Class A ordinary share-diluted		68,286,954			68,316,917
Class B ordinary share-basic		34,762,909			34,762,909
Class B ordinary share-diluted		34,762,909			34,762,909
Other comprehensive income, net of tax
Foreign currency translation adjustments		4,997,233			2,430,761
Comprehensive (loss) income, net of tax		(9,137,789	)		68,455,478
Comprehensive loss attributable to non-controlling interests		2,289,368			3,886,521
Comprehensive (loss) income attributable to ordinary shareholders		(6,848,421	)		72,341,999

All values are in US Dollars.

GreenTree HospitalityGroup Ltd.

Unaudited Condensed ConsolidatedStatements of Cash Flows

	Quarter Ended
	March 31, 2020			March 31, 2021			March 31, 2021
	RMB			RMB			US
Operating activities:
Net income		(14,135,022	)		66,024,717
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		15,666,645			19,074,400
Share of gains in equity method investments		(394,844	)		(379,566	)		)
Fair value change in returnable consideration and contingent consideration, net		-			(502,712	)		)
Interest income		(2,744,441	)		(2,089,240	)		)
Bad debt expense		5,919,636			11,757,435
Losses (Gains) on equity securities		55,174,917			(27,724,291	)		)
Foreign exchange losses		1,157,432			732,281
Share-based compensation		232,558			778,699
Withholding tax		4,000,000			-
Changes in operating assets and liabilities:
Accounts receivable		6,121,451			(12,126,644	)		)
Prepaid rent		4,335,665			(8,105,712	)		)
Inventories		(394,213	)		1,172,977
Amounts due from related parties		794,843			(3,385,042	)		)
Other current assets		20,315,530			(80,953,704	)		)
Other assets		(5,682,307	)		1,788,864
Accounts payable		1,286,146			1,805,682
Amounts due to related parties		(2,018,023	)		101,187
Salary and welfare payable		(2,017,251	)		674,137
Deferred revenue		(30,918,517	)		(14,664,778	)		)
Advance from customers		(2,574,201	)		(4,253,546	)		)
Accrued expenses and other current liabilities		(104,735,404	)		15,395,642
Income tax payable		(16,151,267	)		4,988,817
Unrecognized tax benefits		14,285,229			5,642,471
Deferred rent		5,061,762			4,234,903
Other long-term liabilities		12,994,529			10,881,411
Deferred taxes		(13,967,629	)		7,420,469
Net cash used in operating activities		(48,386,776	)		(1,711,143	)		)
Investing activities:
Purchases of property and equipment		(23,078,232	)		(68,499,010	)		)
Payment for acquisition of minority equity		-			(868,387	)		)
Acquisitions, net of cash received		-			(309,500	)		)
Collection of acquisition advances		-			1,000,000
Advances for purchases of property and equipment		-			(34,463,020	)		)
Advance for acquisitions		-			(53,350,105	)		)
Purchases of short-term investments		(101,270,000	)		(64,924,355	)		)
Proceeds from short-term investments		395,066,686			223,549,240
Proceeds from sales of long-term time deposits		-			50,000,000
Increase of long-term time deposits		(30,000,000	)		(130,000,000	)		)
Loan to related parties		(165,516,500	)		(178,277,880	)		)
Repayment from related parties		165,516,500			147,415,500
Loan to third parties		(2,000,000	)		(1,500,000	)		)
Loan to franchisees		(98,730,000	)		(191,020,002	)		)
Repayment from franchisees		15,015,463			43,074,326
Net cash provided by (used in) investing activities		155,003,917			(258,173,193	)		)
Financing activities:
Loan from non-controlling interest		-			2,792,853
Proceeds from short-term borrowings		10,000,000			130,000,000
Capital contribution from noncontrolling interest holders		400,000			3,291,000
Net cash provided by financing activities		10,400,000			136,083,853
Effect of exchange rate changes on cash and cash equivalents		(575,018	)		409,130
Net increase(decrease) in cash and cash equivalents		116,442,123			(123,391,353	)		)
Cash and cash equivalents at the beginning of the period		342,160,223			633,728,109
Cash and cash equivalents at the end of the period		458,602,346			510,336,756

All values are in US Dollars.

GreenTreeHospitality Group Ltd.

UnauditedReconciliation of GAAP and Non-GAAP Results

	Quarter Ended
	March 31, 2020			March 31, 2021		March 31, 2021
	RMB			RMB		US
Net income		(14,135,022	)		66,024,717
Deduct:
Other operating income		17,330,931			17,872,403
Interest income and other, net		10,613,260			15,131,096
Gains from investment in equity securities		-			27,724,291
Share of gains in equity investees, net of tax		394,844			379,566
Add:
Other operating expenses		1,157,149			1,393,556
Income tax expense		6,177,560			35,206,811
Interest expense		1,010,255			3,388,211
Depreciation and amortization		15,666,645			19,074,400
Losses from investment in equity securities		55,174,918			-
Adjusted EBITDA (Non-GAAP)		36,712,470			63,980,339

All values are in US Dollars.

	Quarter Ended
	March 31, 2020			March 31, 2021		March 31, 2021
	RMB			RMB		US
Net income		(14,135,022	)		66,024,717
Deduct:
Government subsidies (net of 25% tax)		12,432,572			10,290,918
Gains from investment in equity securities (net of 25% tax)		-			20,793,218
Add:
Share-based compensation		232,558			778,699
Losses from investments in equity securities (net of 25% tax)		50,081,189			-
One-time fees and expense		-			3,673,391
Asset impairment/Accrued bad debt		-			4,523,574
Income tax expenses related to dividend distribution		4,000,000			-
Core net income(Non-GAAP)		27,746,794			43,916,245
Core net income per ADS (Non-GAAP)
Class A ordinary share-basic and diluted		0.27			0.43
Class B ordinary share-basic and diluted		0.27			0.43

All values are in US Dollars.

Operational Data

	2020 Q1		2021 Q1
Total hotels in operation:		3,998		4,464
Leased-and-owned hotels		35		43
Franchised hotels		3,963		4,421
Total hotel rooms in operation		292,716		323,648
Leased-and-owned hotels		4,349		5,350
Franchised hotels		288,367		318,298
Number of cities		342		353
	Quarter Ended
---	---	---	---	---	---	---
	2020 Q1			2021 Q1
Occupancy rate (as a percentage)
Leased-and-owned hotels		32.7	%		51.7	%
Franchised hotels		47.7	%		63.7	%
Blended		47.3	%		63.4	%
Average daily rate (in RMB)
Leased-and-owned hotels		169			184
Franchised hotels		149			150
Blended		150			151
RevPAR (in RMB)
Leased-and-owned hotels		55			95
Franchised hotels		71			96
Blended		71			96

	Number<br> of Hotels in Operation				Number<br> of Hotel Rooms in Operation
	2020 Q1		2021 Q1		2020 Q1		2021 Q1
Luxury		20		26		4,607		5,337
Argyle		20		26		4,607		5,337
Mid-to-up-scale		272		387		24,595		35,203
GreenTree Eastern		109		162		11,649		17,136
Deepsleep Hotel		2		4		161		286
Gem		28		38		2,517		3,499
Gya		26		45		2,165		3,847
Vx		22		40		1,766		3,309
Ausotel		10		12		1,287		1,589
Urban<br> Garden and others^[1]^		75		86		5,050		5,537
Mid-scale		2,582		2,864		211,155		229,314
GreenTree Inn		2,027		2,177		172,385		181,964
GT Alliance		315		430		24,231		31,617
GreenTree Apartment		10		15		438		1,031
Vatica		122		122		8,937		8,859
City<br> 118 Selected and others^[1]^		108		120		5,164		5,843
Economy hotels		1,124		1,187		52,359		53,794
Shell		555		634		24,215		27,512
City<br> 118 and others^[1]^		569		553		28,144		26,282
Total		3,998		4,464		292,716		323,648