GHG 6-K 2023 - 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

September 2023

Commission File Number: 001-38425

GreenTree Hospitality Group Ltd.

(Registrant’s name)

1228 Zhongshan North Road, Putuo District

Shanghai 200065

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 ¨

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: September 20, 2023

EXHIBIT INDEX

Exhibit No.	Description
99.1	GreenTree<br> Hospitality Group Ltd. Reports First Half 2023 Financial Results

Exhibit 99.1

GreenTree Hospitality Group Ltd. Reports FirstHalf 2023 Financial Results

·	Total revenues increased by 12.1% year over year to RMB794.2 million (US$109.5 million)^[1]^.
·	Income from operations was RMB150.9 million (US$20.8 million)^[1]^, compared to RMB-474.3 million for the first half of 2022.
---	---
·	Net income was RMB177.3 million (US$24.5 million)^[1]^, compared to RMB-384.5 million for the first half of 2022.
---	---
·	Adjusted EBITDA (non-GAAP)^[2]^increased by 137.8% year over year to RMB226.9 million (US$31.3 million)^[1]^.
---	---
·	Core net income (non-GAAP)^[3]^increased by 65.2% year over year to RMB136.1 million (US$18.8 million)^[1]^.
---	---

SHANGHAI, September 18, 2023 /PRNewswire/ -- GreenTree Hospitality Group Ltd. (NYSE: GHG) ("GreenTree", the "Company", "we", "us" and "our"), a leading hospitality and restaurant management group in China, today announced its unaudited financial results for the first half of 2023. As Da Niang Dumplings and Bellagio, two leading restaurant chain businesses in China, were all under the control of our founder, Alex S. Xu, until their acquisition by the Company, the Company accounted for the common-control acquisitions by using the pooling of interest method. The consolidated balance sheets and consolidated statements of comprehensive income/(loss) include the results of each of the combining entities or businesses from the earliest date presented or since the date when the combining entities or businesses first came under common control. In this report, the comparative financial data have been restated to reflect the business combinations under common control.

First Half 2023 Operational Highlights

Hotels

·	A<br> total of 4,108 hotels with 303,387 hotel rooms were in operation as of June 30, 2023.
·	The<br> Company opened 183 hotels during the six months ended June 30, 2023, and had a pipeline of<br> 969 hotels contracted for or under development as of June 30, 2023.
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1 The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on the exchange rate of US$1.00=RMB 7.2513 on June 30, 2023 as set forth in H.10 statistical release of the U.S. Federal Reserve Board and available at https://www.federalreserve.gov/releases/h10/20220103/.

2 Adjusted EBITDA (non-GAAP) is calculated as net income plus other operating expenses, income tax expense, share of loss in equity investees, net of tax, interest expense, depreciation and amortization, losses from investment in equity securities and the provision for bad debts, but excludes other operating income, interest income and other, net, gains from investment in equity securities, share of gains in equity investees (net of tax), and other income, net. The calculation of Adjusted EBITDA (non-GAAP) included in this report has been aligned according to the abovementioned definition.

3 Core net income is calculated as net income plus share-based compensation, losses from investments in equity securities (net of 25% tax), one-time fees and expense and asset impairment/accrued bad debts but excludes government subsidies (net of 25% tax), gains from investment in equity securities (net of 25% tax), and other income (net of 25% tax).

·	The<br> average daily room rate was RMB167 in the first quarter of 2023, an increase of 9.1% from<br> RMB153 in the first quarter of 2022, and RMB181 in the second quarter of 2023, a 23.1% year-over-year<br> increase.
·	The<br> occupancy rate was 71.7% in the first quarter of 2023, up from 60.0% in the first quarter<br> of 2022, and 77.8% in the second quarter of 2023, compared to 62.2% in the second quarter<br> of 2022.
---	---
·	Revenue<br> per available room, or RevPAR, was RMB120 in the first quarter of 2023, a 30.4% year-over-year<br> increase, and RMB141 in the second quarter of 2023, a 54.0% year-over-year increase.
---	---

Restaurants

·	A<br> total of 218 restaurants were in operation as of June 30, 2023.
·	The<br> AC (average check) was RMB55 in the first quarter of 2023, a 19.2% year-over-year increase,<br> and RMB53 in the second quarter of 2023, a 2.2% year-over-year increase.
---	---
·	The<br> ADT (average daily tickets) was 110 in the first quarter of 2023, down from 130 in the first<br> quarter of 2022, and 120 in the second quarter of 2023, compared to 78 in the second quarter<br> of 2022.
---	---
·	The<br> ADS (average daily sales per store) was RMB 6,080 in the first quarter of 2023, an increase<br> of 0.9% from RMB 6,027 in the first quarter of 2022, and RMB 6,371 in the second quarter<br> of 2023, a 57.3% year-over-year increase.
---	---

"For our hotel business, the first quarter of 2023 marked a new beginning thanks to the recovery in the hospitality industry and the entire economy in China. RevPAR recovered to 94.3% of its first quarter of 2019 level. RevPAR during the national Labor Day holiday in early May reached more than 120% of its level in the same period in 2019, capitalizing on the popularity of travel during the national holiday period. And due to an increase in the number of people traveling during the summer vacation, RevPAR in July and August was nearly stable at 110% of its level in the same period in 2019.

As previously disclosed, the Company completed the acquisition of Da Niang Dumplings and Bellagio, two leading restaurant chain businesses in China from our controlling shareholder. Our strategy and execution in our restaurant business focus on further expansion in the proportion of franchised-and-managed restaurants and greater penetration to street stores. To ensure the profitability of our restaurant business, we closed unprofitable stores. In the first half of 2023, the ADS of restaurant business recovered to 122.9% of its first half of 2022 level.

“We are grateful for the hard work of our team, franchisees, and partners, and the support of our customers that made it possible to recover quickly starting from the first quarter of 2023 as China began returning to normal life," said Mr. Alex S. Xu, Chairman and Chief Executive Officer of GreenTree.

First Half 2023 Financial Results

	Six months<br> Ended
	June 30, 2022		June 30, 2022		June 30, 2022			June 30, 2022
	RMB		RMB		RMB			RMB
	Hotel		Restaurant		Elimination			Total
Revenues
Leased-and-operated revenues		171,272,365		171,008,920		(229,756	)		342,051,529
Franchised-and-managed revenues		275,539,547		18,229,310					293,768,857
Wholesales and others		10,564,787		62,284,229					72,849,016
Total revenues		457,376,699		251,522,459		(229,756	)		708,669,402

	Six months<br> Ended
	June 30, 2023		June 30, 2023		June 30, 2023			June 30, 2023		June 30, 2023
	RMB		RMB		RMB			RMB		US
	Hotel		Restaurant		Elimination			Total		Total
Revenues
Leased-and-operated revenues		213,563,927		168,340,074		(1,125,179	)		380,778,822
Franchised-and-managed revenues		347,417,000		17,355,892					364,772,892
Wholesales and others		2,225,580		46,432,697					48,658,277
Total revenues		563,206,507		232,128,663		(1,125,179	)		794,209,991

All values are in US Dollars.

Total revenuesfor the first half of 2023 were RMB794.2 million (US$109.5 million)^[1]^, a 12.1% year-over-year increase.

Hotel revenues were RMB563.2 million (US$77.7 million), a 23.1% year-over-year increase. The increase was mainly attributable to the recovery in RevPAR and the increase in the number of hotels.

Restaurant revenues were RMB232.1 million (US$32.0 million), a 7.7% year-over-year decrease. The decrease was mainly due to the closure of 64 stores, and partially offset by an increase in ADS.

Total revenues fromleased-and-operated, or L&O, hotels and restaurants were RMB380.8 million (US$52.5 million)^[1]^, a 11.3% year-over-year increase.

Total revenues from L&O hotels for the first half of 2023 were RMB213.6 million (US$29.5 million)^[1]^, a 24.7% year-over-year increase. The increase was primarily attributable to a 47.8% year-over-year increase in L&O hotels’ first half RevPAR and more newly opened L&O hotels in the first half of 2023 as compared to the first half of 2022.

Total revenues from L&O restaurants for the first half of 2023 were RMB168.3 million (US$23.2 million)^[1]^, a 1.6% year-over-year decrease. The decrease was mainly due to the closure of 47 L&O stores, and partially offset by an increase in ADS.

Total revenues fromfranchised-and-managed, or F&M, hotels and restaurants were RMB364.8 million (US$ 50.3 million)^[1]^, a 24.2% year-over-year increase.

Total revenues from F&M hotels were RMB347.4 million (US$47.9 million)^[1]^, a 26.1% year-over-year increase. Initial franchise fees increased 9.3% year over year, mainly because of the increase in the gross opening number of F&M hotels. Recurring franchisee management fees and others increased by 27.8% year over year, primarily due to a 46.4% increase in F&M hotels’ RevPAR and the increase of 167 F&M hotels.

Total revenues from F&M restaurants were RMB17.4 million (US$2.4 million)^[1]^, a 4.8% year-over-year decrease. The decrease was mainly due to a decrease of 17 F&M stores numbers, and partially offset by a 22.9% increase in F&M stores’ average daily sales.

Total revenues fromwholesale and others were RMB48.7 million (US$ 6.7 million)^[1]^, a 33.2% year-over-year decrease, mainly because of reduced business from supermarkets, partially offset by increased business through distributors.

Total operating costs and expenses

	Six Months<br> Ended
	June 30, 2022		June 30, 2022		June 30, 2022		June 30, 2022
	RMB		RMB		RMB		RMB
	Hotel		Restaurant		Elimination		Total
Operating costs and expenses
Operating costs		307,750,028		234,911,742		289,605		542,951,375
Selling and marketing expenses		18,852,606		9,717,435				28,570,041
General and administrative expenses		99,724,402		21,847,196				121,571,598
Other operating expenses		2,048,734		2,240,920				4,289,654
Other general expenses		490,619,710						490,619,710
Total operating costs and expenses		918,995,480		268,717,293		289,605		1,188,002,378

	Six Months<br> Ended
	June 30, 2023		June 30, 2023		June 30, 2023			June 30, 2023		June 30, 2023
	RMB		RMB		RMB			RMB		US
	Hotel		Restaurant		Elimination			Total		Total
Operating costs and expenses
Operating costs		284,364,378		204,308,159		(610,088	)		488,062,449
Selling and marketing expenses		24,838,605		9,385,645					34,224,250
General and administrative expenses		90,535,547		21,338,810					111,874,357
Other operating expenses		843,564		6,990,654					7,834,218
Other general expenses		15,973,584							15,973,584
Total operating costs and expenses		416,555,678		242,023,268		(610,088	)		657,968,858

All values are in US Dollars.

Operating costs were RMB488.1 million (US$67.3 million)^[1]^, a 10.1% year-over-year decrease.

Operating costs of the hotel business were RMB284.4 million (US$39.2 million)^[1]^, a 7.6% year-over-year decrease. The decrease was mainly due to the deconsolidation of Argyle Hotel Management Group (Australia) Pty Ltd., or Argyle, and the disposal of our interest in Urban Hotel Group, or Urban, and was partially offset by higher consumables and higher utility costs as business rebounded, as well as higher rents with lower exemption compared to last year.

Operating costs of the restaurant business were RMB204.3 million (US$28.2 million)^[1]^, a 13.0% year-over-year decrease. The decrease was due to the closure of 64 stores.

Selling and marketing expenses were RMB34.2 million (US$4.7 million)^[1]^, a 19.8% year-over-year increase.

Selling and marketing expenses of the hotel business were RMB24.8 million (US$3.4 million)^[1]^, a 31.8% year-over-year increase. The increase was mainly attributable to higher sales-channel commissions, higher sales staff salaries, and higher travel expenses.

Selling and marketing expenses of the restaurant business were RMB9.4 million (US$1.3 million)^[1]^, a 3.4% year-over-year decrease. The decrease was mainly attributable to lower advertising expenses and lower sales-channel commissions.

General and administrative, or G&A expenseswere RMB111.9 million (US$15.4 million)^[1]^, an 8.0% year-over-year decrease.

G&A expenses of the hotel business were RMB90.5 million (US$12.5 million)^[1]^, a 9.2% year-over-year decrease. The decrease was mainly due to the deconsolidation of Argyle and the disposal of our interest in Urban,and partially offset by higher consulting fees and higher staff related expenses.

G&A expenses of the restaurant business were RMB21.3 million (US$2.9 million)^[1]^, a 2.3 % year-over-year decrease. The decrease was mainly due to lower staff related expenses and lower rents due to the closure of 64 stores.

Other general expenses of the hotel business were RMB16.0 million (US$2.2 million)^[1]^, a 96.7% year-over-year decrease.These expenses include the provisions for loan receivables related to franchisee loans, and impairments caused by the disposal of 4 unprofitable hotels.

Gross profit was RMB306.1 million (US$42.2 million)^[1]^, a year-over-year increase of 84.7%. Gross margin was 38.5%, compared to 23.4% a year ago. The gross profit of the hotel business was RMB278.8 million (US$38.5 million)^[1]^, an 86.4% year-over-year increase. The gross profit of the restaurant business was RMB27.8 million (US$3.8 million)^[1]^, a 67.5% year-over-year increase.

Income from operations was RMB150.9 million (US$20.8 million)^[1] ,^compared to a loss from operations of RMB474.3 million in the first half of 2022, with a margin of 19.0%.

Income from operations of the hotel business was RMB160.4 million (US$22.1 million)^[1]^, compared to a loss from operations of RMB457.7 million in the first half of 2022, with a margin of 28.5%.

Loss from operations of the restaurant business was RMB9.0 million (US$1.2 million)^[1]^, compared to a loss from operations of RMB16.1 million in the first half of 2022, with a margin of -3.9%.

Net income was RMB177.3 million (US$24.5 million)^[1]^, compared to a net loss of RMB384.5 million in the first half of 2022, and net margin was 22.3%.

Net income of the hotel business was RMB191.8 million (US$26.5 million)^[1]^, compared to a net loss of RMB360.9 million in the first half of 2022, and net margin was 34.1%.

Net loss of the restaurant business was RMB14.1 million (US$1.9 million)^[1]^, compared to a net loss of RMB23.2 million in the first half of 2022, and net margin was -6.1%.

Adjusted EBITDA (non-GAAP)^[2]^ **** was RMB226.9 million (US$31.3 million)^[1]^, a year-over-year increase of 137.8%. Adjusted EBITDA margin, defined as adjusted EBITDA (non-GAAP) as a percentage of total revenues, was 28.6%, compared to 13.5% a year ago.

Core net income (non-GAAP) was RMB136.1 million (US$18.8 million)^[1]^, a year-over-year increase of 65.2%. The core net margin, defined as core net income (non-GAAP) as a percentage of total revenues, for the first half of 2023 was 17.1%, compared to 11.6% one year ago.

Earnings per American Depositary Share, orADS, (basic and diluted) were RMB1.79 (US$0.25)^[1]^, up from RMB-3.38 one year ago. Core net income per ADS (basic and diluted) (non-GAAP) for the first half of 2023 was RMB1.33 (US$0.18)^[1]^, up from RMB0.80 a year ago.

Cash flow Operating cash inflow was RMB313.1 million (US$43.2 million)^[1]^ as a result of income from operations. Investing cash inflow for the first half of 2023 was RMB128.2 million (US$17.7 million)^[1]^, which was primarily attributable to proceeds from short-term investments and repayment from franchisees. The investing cash inflow was partially offset by purchases of property and equipment and short-term investments. Financing cash outflow was RMB37.4 million (US$5.2 million)^[1]^, mainly attributable to the repayment of bank loans by the end of the June 30, 2023.

Cash and cash equivalents, restricted cash,short-term investments, investments in equity securities and time deposits. As of June 30, 2023, the Company had total cash and cash equivalents, restricted cash, short term investments, investments in equity securities and time deposits of RMB1,440.1 million (US$198.6 million)^[1]^, compared to RMB1,119.4 million as of December 31, 2022. The increase was primarily due to cash from operating activities and repayment from franchisees, proceeds from disposal of subsidiaries, partially offset by repayment of bank loans and investment of property.

Guidance

Taking into account the recovery in long-term trends and short-term industry fluctuations, we expect total revenues of organic hotels for the full year of 2023 to grow 30%-35% of the 2022 levels. Total revenues for our restaurant business and our organic hotel business, for the full year of 2023 are expected to grow 15%-20% over the 2022 levels.

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

Conference Call

GreenTree's management will hold an earnings conference call at 9:00 PM U.S. Eastern Time on September 18, 2023, (9:00 AM Beijing/Hong Kong Time on September 19, 2023).

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 conference call will be available after the conclusion of the live conference call until September 25, 2023.

Dial-in numbers for the replay are as follows:

International<br> Dial-in	1-412-317-0088
U.S. Toll Free	1-877-344-7529
Canada Toll Free	855-669-9658
Passcode:	8450773

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 them, are useful financial metrics 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 do 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 terms Adjusted EBITDA and core net income are not defined under U.S. GAAP, and Adjusted EBITDA and core net income are not measures 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 and restaurant management group in China. As of June 30, 2023, GreenTree had a total number of 4,108 hotels and 218 restaurants. In 2023, HOTELS magazine ranked GreenTree 12th among the 225 largest global hotel groups in terms of number of hotels in its annual HOTELS' 225. GreenTree was the fourth largest hospitality company in China in 2022 according to the China Hospitality Association. In 2023, GreenTree completed its acquisition of Da Niang Dumplings and Bellagio, two leading restaurant chain businesses in China.

GreenTree has a broad portfolio of diverse brands spanning from the economy to mid-scale, up-scale and luxury segments of the hospitality industry mainly in China. 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 diverse 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

GreenTreeHospitality Group Ltd.

UnauditedCondensed Consolidated Balance Sheets

****	December 31,	June 30,	June 30,
****	2022	2023	2023
	RMB	RMB	US$
ASSETS
Current assets:
Cash and cash equivalents	701,332,213	1,115,384,452	153,818,550
Restricted cash	7,937,397	-	-
Short-term investments	186,031,572	235,416,298	32,465,392
Investments in equity securities	41,361,346	27,460,488	3,786,974
Accounts receivable, net of allowance	140,429,505	126,306,120	17,418,410
Amounts due from related parties	451,786,275	44,473,106	6,133,122
Prepaid rent	-	-	-
Inventories	30,503,712	23,052,986	3,179,152
Other current assets	142,169,713	147,472,648	20,337,408
Loans receivable, net	181,667,170	152,938,524	21,091,187
Total current assets	1,883,218,903	1,872,504,622	258,230,195
Non-current assets:
Amounts due from a related party	112,360,000	112,360,000	15,495,153
Restricted cash	25,359,592	23,544,862	3,246,985
Long-term time deposits	130,000,000	-	-
Loans receivable, net	177,172,509	98,598,159	13,597,308
Property and equipment, net	899,985,340	883,944,435	121,901,512
Intangible assets, net	174,748,932	171,687,271	23,676,757
Goodwill	128,752,950	128,752,950	17,755,844
Long-term investments	176,854,460	186,909,291	25,775,970
Operating lease right-of-use assets	1,676,544,520	1,633,368,783	225,251,856
Other assets	120,620,533	114,673,765	15,814,236
Deferred tax assets	242,186,616	260,348,940	35,903,761
TOTAL ASSETS	5,747,804,355	5,486,693,078	756,649,577
LIABILITIES AND EQUITY
---	---	---	---	---	---	---
Current liabilities:
Short-term bank loans	298,100,000		270,700,000		37,331,237
Long-term bank loans, current portion	-		-		-
Accounts payable	123,522,029		113,604,869		15,666,828
Advance from customers	26,480,779		22,822,957		3,147,430
Amounts due to related parties	24,810,304		23,130,913		3,189,899
Salary and welfare payable	89,343,058		95,815,922		13,213,620
Deferred rent	-		-		-
Deferred revenue	199,656,130		201,488,954		27,786,597
Accrued expenses and other current liabilities	455,519,530		505,932,951		69,771,345
Income tax payable	74,672,133		116,954,407		16,128,750
Dividends payable	-		-		-
Operating lease liabilities, current	271,518,556		280,717,711		38,712,743
Deferred tax liabilities	34,473,265		34,344,492		4,736,322
Total current liabilities	1,598,095,784		1,665,513,176		229,684,771
Long-term bank loans	160,000,000		150,000,000		20,685,946
Deferred rent	-		-		-
Deferred revenue	232,857,456		225,165,519		31,051,745
Other long-term liabilities	128,196,031		112,114,674		15,461,320
Operating lease liabilities, non-current	1,521,589,481		1,473,955,554		203,267,766
Deferred tax liabilities	63,815,023		50,773,630		7,002,004
Unrecognized tax benefits	350,002,241		381,962,640		52,675,057
TOTAL LIABILITIES	4,054,556,016		4,059,485,193		559,828,609
Shareholders’ equity:
Class A ordinary shares	222,587,070		222,587,070		30,696,161
Class B ordinary shares	115,534,210		115,534,210		15,932,896
Paid-in capital	94,000,801		94,000,801		12,963,303
Treasury Stock	(16,971,057	)	(16,971,057	)	(2,340,416	)
Additional paid-in capital	1,911,328,052		1,491,556,644		205,695,068
Retained earnings (Accumulated losses)	(698,677,163	)	(540,865,018	)	(74,588,697	)
Accumulated other comprehensive income	27,732,104		28,728,211		3,961,801
Total GreenTree Hospitality Group Ltd. shareholders’<br> equity	1,655,534,017		1,394,570,861		192,320,116
Non-controlling interests	37,714,322		32,637,024		4,500,852
Total shareholders’ equity	1,693,248,339		1,427,207,885		196,820,968
TOTAL LIABILITIES AND SHAREHOLDERS’<br> EQUITY	5,747,804,355		5,486,693,078		756,649,577

GreenTree HospitalityGroup Ltd.

Unaudited Condensed ConsolidatedStatements of Comprehensive Income

	Six<br> Months Ended			Three<br> Months Ended						Six<br> Months Ended
	June 30, 2022			March 31, 2023			June 30, 2023			June 30, 2023			June 30, 2023
	RMB			RMB			RMB			RMB			US
Revenues
Leased-and-operated revenues		342,051,529			170,890,916			209,887,906			380,778,822
Franchised-and-managed revenues		293,768,857			178,526,853			186,246,039			364,772,892
Wholesales and others		72,849,016			29,802,650			18,855,627			48,658,277
Total revenues		708,669,402			379,220,419			414,989,572			794,209,991
Operating costs and expenses
Operating costs		(542,951,375	)		(243,155,310	)		(244,907,139	)		(488,062,449	)		)
Selling and marketing expenses		(28,570,041	)		(16,015,579	)		(18,208,671	)		(34,224,250	)		)
General and administrative expenses		(121,571,598	)		(57,755,145	)		(54,119,212	)		(111,874,357	)		)
Other operating expenses		(4,289,654	)		(1,492,483	)		(6,341,735	)		(7,834,218	)		)
Other general expenses		(490,619,710	)		(11,664,345	)		(4,309,239	)		(15,973,584	)		)
Total operating costs and expenses		(1,188,002,378	)		(330,082,862	)		(327,885,996	)		(657,968,858	)		)
Other operating income		5,043,707			3,159,519			11,511,398			14,670,917
Income from operations		(474,289,269	)		52,297,076			98,614,974			150,912,050
Interest income and other, net		24,042,558			7,629,014			9,750,337			17,379,351
Interest expense		(17,441,575	)		(5,528,061	)		(3,868,469	)		(9,396,530	)		)
Gains (losses) from investment in equity securities		21,687,584			(4,536,562	)		(263,836	)		(4,800,398	)		)
Other income, net		14,751,769			(2,149,582	)		77,119,089			74,969,507
Income before income taxes		(431,248,933	)		47,711,885			181,352,095			229,063,980
Income tax expense		46,658,590			7,022,835			(57,972,918	)		(50,950,083	)		)
Income (loss) before share of gains in equity investees		(384,590,343	)		54,734,720			123,379,177			178,113,897
Share of loss/(income) in equity investees,<br> net of tax		75,125			(445,618	)		(341,265	)		(786,883	)		)
Net income(loss)		(384,515,218	)		54,289,102			123,037,912			177,327,014
Net loss/(income) attributable to non-controlling<br> interests		35,800,468			3,768,594			1,308,704			5,077,298
Net income attributable to ordinary<br> shareholders		(348,714,750	)		58,057,696			124,346,616			182,404,312
Net earnings per share
Class A ordinary share-basic and diluted		(3.38	)		0.57			1.22			1.79
Class B ordinary share-basic and diluted		(3.38	)		0.57			1.22			1.79
Net earnings per ADS
Class A ordinary share-basic and diluted		(3.38	)		0.57			1.22			1.79
Class B ordinary share-basic and diluted		(3.38	)		0.57			1.22			1.79
Weighted average shares outstanding
Class A ordinary share-basic and diluted		68,286,954			67,416,046			67,416,046			67,416,046
Class B ordinary share-basic and diluted		34,762,909			34,762,909			34,762,909			34,762,909
Other comprehensive income, net of tax
Foreign currency translation adjustments		(9,730,001	)		810,574			185,533			996,107
Comprehensive income, net of tax		(394,245,219	)		55,099,676			123,223,445			178,323,121
Comprehensive loss/(income) attributable<br> to non-controlling interests		35,800,468			3,768,594			(4,843,631	)		(1,075,037	)		)
Comprehensive income (loss) attributable<br> to ordinary shareholders		(358,444,751	)		58,868,270			118,379,814			177,248,084

All values are in US Dollars.

GreenTree HospitalityGroup Ltd.

Unaudited Hotel BusinessResults

	Six<br> Months Ended			Three<br> Months Ended						Six<br> Months Ended
	June 30, 2022			March 31, 2023			June 30, 2023			June 30, 2023			June 30, 2023
	RMB			RMB			RMB			RMB			US
Revenues
Leased-and-operated revenues		171,272,365			82,073,240			131,490,687			213,563,927
Franchised-and-managed revenues		275,539,547			169,480,457			177,936,543			347,417,000
Others		10,564,787			1,036,848			1,188,732			2,225,580
Total revenues		457,376,699			252,590,545			310,615,962			563,206,507
Operating costs and expenses
Hotel operating costs		(307,750,028	)		(134,236,998	)		(150,127,380	)		(284,364,378	)		)
Selling and marketing expenses		(18,852,606	)		(11,075,999	)		(13,762,606	)		(24,838,605	)		)
General and administrative expenses		(99,724,402	)		(46,092,069	)		(44,443,478	)		(90,535,547	)		)
Other operating expenses		(2,048,734	)		(151,220	)		(692,344	)		(843,564	)		)
Other general expenses		(490,619,710	)		(11,664,345	)		(4,309,239	)		(15,973,584	)		)
Total operating costs and expenses		(918,995,480	)		(203,220,631	)		(213,335,047	)		(416,555,678	)		)
Other operating income		3,917,398			2,608,096			11,183,689			13,791,785
Income from operations		(457,701,383	)		51,978,010			108,464,604			160,442,614
Interest income and other, net		23,730,138			7,475,298			9,597,042			17,072,340
Interest expense		(15,178,612	)		(4,724,690	)		(3,167,262	)		(7,891,952	)		)
Gains (losses) from investment in equity securities		21,687,584			(4,536,562	)		(263,836	)		(4,800,398	)		)
Other income, net		14,664,617			(2,426,540	)		76,946,162			74,519,622
Income before income taxes		(412,797,656	)		47,765,516			191,576,710			239,342,226
Income tax expense		51,800,695			9,365,855			(56,097,180	)		(46,731,325	)		)
Income (loss) before share of gains in equity investees		(360,996,961	)		57,131,371			135,479,530			192,610,901
Share of loss/(income) in equity investees,<br> net of tax		75,125			(445,618	)		(341,265	)		(786,883	)		)
Net income(loss)		(360,921,836	)		56,685,753			135,138,265			191,824,018

All values are in US Dollars.

GreenTree HospitalityGroup Ltd.

Unaudited RestaurantBusiness Results

	Six<br> Months Ended			Three<br> Months Ended						Six<br> Months Ended
	June 30, 2022			March 31, 2023			June 30, 2023			June 30, 2023			June 30, 2023
	RMB			RMB			RMB			RMB			US
Revenues
Leased-and-operated revenues		171,008,920			89,376,893			78,963,181			168,340,074
Franchised-and-managed revenues		18,229,310			9,046,396			8,309,496			17,355,892
Wholesales and others		62,284,229			28,765,802			17,666,895			46,432,697
Total revenues		251,522,459			127,189,091			104,939,572			232,128,663
Operating costs and expenses
Restaurant operating costs		(234,911,742	)		(109,219,983	)		(95,088,176	)		(204,308,159	)		)
Selling and marketing expenses		(9,717,435	)		(4,939,580	)		(4,446,065	)		(9,385,645	)		)
General and administrative expenses		(21,847,196	)		(11,663,076	)		(9,675,734	)		(21,338,810	)		)
Other operating expenses		(2,240,920	)		(1,341,263	)		(5,649,391	)		(6,990,654	)		)
Other general expenses		-			-			-			-
Total operating costs and expenses		(268,717,293	)		(127,163,902	)		(114,859,366	)		(242,023,268	)		)
Other operating income		1,126,309			551,423			327,709			879,132
Income from operations		(16,068,525	)		576,612			(9,592,085	)		(9,015,473	)		)
Interest income and other, net		312,420			153,716			153,295			307,011
Interest expense		(2,262,963	)		(803,371	)		(701,207	)		(1,504,578	)		)
Gains (losses) from investment in equity securities		-			-			-			-
Other income, net		87,152			276,958			172,926			449,884
Income before income taxes		(17,931,916	)		203,915			(9,967,071	)		(9,763,156	)		)
Income tax expense		(5,271,945	)		(2,407,407	)		(1,940,124	)		(4,347,531	)		)
Income (loss) before share of gains in equity investees		(23,203,862	)		(2,203,492	)		(11,907,194	)		(14,110,686	)		)
Share of loss/(income) in equity investees,<br> net of tax		-			-			-			-
Net income(loss)		(23,203,862	)		(2,203,492	)		(11,907,194	)		(14,110,686	)		)

All values are in US Dollars.

GreenTreeHospitality Group Ltd.

UnauditedCondensed Consolidated Statements

	Six<br> Months Ended			Six<br> Months Ended			Six<br> Months Ended			Six<br> Months Ended
	June 30, 2022			June 30, 2022			June 30, 2022			June 30, 2022
	Hotel			Restaurant			Elimination			Total
	RMB			RMB			RMB			RMB
Revenues
Leased-and-operated revenues		171,272,365			171,008,920			(229,756	)		342,051,529
Franchised-and-managed revenues		275,539,547			18,229,310						293,768,857
Wholesales and Others		10,564,787			62,284,229						72,849,016
Total revenues		457,376,699			251,522,459			(229,756	)		708,669,402
Operating costs and expenses
Operating costs		(307,750,028	)		(234,911,742	)		(289,605	)		(542,951,375	)
Selling and marketing expenses		(18,852,606	)		(9,717,435	)					(28,570,041	)
General and administrative expenses		(99,724,402	)		(21,847,196	)					(121,571,598	)
Other operating expenses		(2,048,734	)		(2,240,920	)					(4,289,654	)
Other general expenses		(490,619,710	)								(490,619,710	)
Total operating costs and expenses		(918,995,480	)		(268,717,293	)		(289,605	)		(1,188,002,378	)
Other operating income		3,917,398			1,126,309						5,043,707
Income from operations		(457,701,383	)		(16,068,525	)		(519,361	)		(474,289,269	)

GreenTreeHospitality Group Ltd.

UnauditedCondensed Consolidated Statements

	Six<br> Months Ended			Six<br> Months Ended			Six<br> Months Ended			Six<br> Months Ended
	June 30, 2023			June 30, 2023			June 30, 2023			June 30, 2023
	Hotel			Restaurant			Elimination			Total
	RMB			RMB			RMB			RMB
Revenues
Leased-and-operated revenues		213,563,927			168,340,074			(1,125,179	)		380,778,822
Franchised-and-managed revenues		347,417,000			17,355,892						364,772,892
Wholesales and Others		2,225,579			46,432,698						48,658,277
Total revenues		563,206,506			232,128,664			(1,125,179	)		794,209,991
Operating costs and expenses
Operating costs		(284,364,378	)		(204,308,159	)		610,088			(488,062,449	)
Selling and marketing expenses		(24,838,605	)		(9,385,645	)					(34,224,250	)
General and administrative expenses		(90,535,547	)		(21,338,810	)					(111,874,357	)
Other operating expenses		(843,564	)		(6,990,654	)					(7,834,218	)
Other general expenses		(15,973,584	)								(15,973,584	)
Total operating costs and expenses		(416,555,678	)		(242,023,268	)		610,088			(657,968,858	)
Other operating income		13,791,785			879,132						14,670,917
Income from operations		160,442,613			(9,015,472	)		(515,091	)		150,912,050

GreenTreeHospitality Group Ltd.

UnauditedCondensed Consolidated Statements of Cash Flows

	Six<br> Months Ended		Three<br> Months Ended				Six<br> Months Ended
	June 30, 2022		March 31, 2023		June 30, 2023		June 30, 2023		June 30, 2023
	RMB		RMB		RMB		RMB		US
Operating activities:
Net (loss) income		-384,515,218		54,289,102		123,037,911		177,327,013
Depreciation and amortization		79,849,031		31,080,092		35,745,507		66,825,599
Impairment of long lived assets		56,212,849		2,900,000				2,900,000
Impairment of goodwill		91,236,480
Share of (gains) losses in equity method investments		-75,125		445,618		341,265		786,883
Non-cash lease expense		41,659,260		64,053,832		70,769,259		134,823,091
Loss from disposal of a subsidiary		13,944,925		1,223,952				1,223,952
Interest income		-262,334		-390,378		-1,267,532		-1,657,910
Bad debt expense		340,846,428		12,359,278		6,320,196		18,679,474
Losses and impairment (Gains) on equity securities held		-21,687,584		4,536,562		263,836		4,800,398
(Gains) losses on disposal of property and equipment		3,050,035		-113,587		341,428		227,841
Foreign exchange (gains) losses		-12,024,153		987,543		-2,075,742		-1,088,199
Share-based compensation		271,139		-11,636		40,228		28,592
Common control acquisition		519,360		257,546		257,546		515,092
Changes in operating assets and liabilities		-65,089,156		-6,084,179		-86,198,991		-92,283,170
Net cash provided by operating activities		143,935,937		165,533,745		147,574,911		313,108,656
Investing activities:
Purchases of property and equipment		-30,771,557		-34,116,117		-37,617,117		-71,733,234
Purchases of intangible assets		-60,215		-42,454		-309,827		-352,281
Proceeds from disposal of property and equipment		2,288,823		6,973,574		7,723,107		14,696,681
Purchases of investments		-48,860,000				-51,370,000		-51,370,000
Proceeds from investments		506,295,349		110,300,378		61,142,806		171,443,184
Loan advances		94,927,368		27,302,903		48,235,746		75,538,649
Loan collections		-200,868,160		-8,029,596		-1,945,000		-9,974,596
Net cash (used in) provided by investing activities		322,951,608		102,388,688		25,859,715		128,248,403
Financing activities:
Distribution to the shareholders		-40,999,458
Loan from non- controlling interest		300,000
Repayment of short-term borrowings		-169,100,000		-136,600,000		-17,800,000		-154,400,000
Proceeds from bank borrowings		25,300,000		117,000,000				117,000,000
Capital contribution from non-controlling<br> interest holders		-1,600,000
Net cash provided by (used in) financing activities		-186,099,458		-19,600,000		-17,800,000		-37,400,000
Effect of exchange rate changes on cash and cash equivalents		649,388		-40,524		383,575		343,051
Net (decrease) increase in cash and cash equivalents		281,437,475		248,281,909		156,018,201		404,300,110
Cash and cash equivalents at the beginning<br> of the period		385,452,920		734,629,202				734,629,202
Cash and cash equivalents at the<br> end of the period		666,890,395		982,911,111		156,018,201		1,138,929,312

All values are in US Dollars.

GreenTree HospitalityGroup Ltd.

Unaudited Reconciliationof GAAP and Non-GAAP Results

	Six<br> Months Ended
	June 30, 2022			June 30, 2023		June 30, 2023
	RMB			RMB		US
Net income		(384,515,218	)		177,327,013
Deduct:
Other operating income		5,043,707			14,670,917
Interest income and other, net		24,042,558			17,379,351
Gains from investment in equity securities		21,687,584			-
Share of gain in equity investees, net of tax		75,125			-
Other income, net		14,751,769			74,969,507
Add:
Other operating expenses		4,289,654			7,834,218
Other general expenses		490,619,710			15,973,584
Income tax expenses (benefits)		(46,658,590	)		50,950,083
Share of loss in equity investees, net of tax		-			786,883
Interest expenses		17,441,575			9,396,530
Depreciation and amortization		79,849,031			66,825,599
Losses from investment in equity securities		-			4,800,398
Adjusted EBITDA (Non-GAAP)		95,425,419			226,874,533

All values are in US Dollars.

	Six<br> Months Ended
	June 30, 2022			June 30, 2023		June 30, 2023
	RMB			RMB		US
Net income		(384,515,218	)		177,327,013
Deduct:
Government subsidies (net of 25% tax)		1,251,065			6,671,305
Gains from investment in equity securities (net of 25% tax)		16,265,688			-
Other income (net of 25% tax)		11,063,827			56,227,130
Add:
Share-based compensation		271,139			28,592
Losses from investments in equity securities (net of 25% tax)		-			3,600,299
One-time fees and expenses		4,588,086			2,055,989
Other general expenses		490,619,710			15,973,584
Impairment charges and provisions for<br> other assets		-			-
Core net income (Non-GAAP)		82,383,137			136,087,042
Core net income per ADS (Non-GAAP)
Class A ordinary share-basic and diluted		0.80			1.33
Class B ordinary share-basic and diluted		0.80			1.33

All values are in US Dollars.

Hotel Operational Data

	June 30,<br> 2022		June 30,<br> 2023
Total hotels in operation:		4,669		4,108
Leased and owned hotels		67		65
Franchised hotels		4,602		4,043
Total hotel rooms in operation		332,073		303,387
Leased and owned hotels		6,986		7,137
Franchised hotels		325,087		296,250
Number of cities		367		357
	Quarter<br> Ended
---	---	---	---	---	---	---
	2022 Q1			2023<br> Q1
Occupancy rate (as a percentage)
Leased-and-owned hotels		52.6	%		62.9	%
Franchised hotels		60.2	%		71.9	%
Blended		60.0	%		71.7	%
Average daily rate (in RMB)
Leased-and-owned hotels		199			229
Franchised hotels		152			166
Blended		153			167
RevPAR (in RMB)
Leased-and-owned hotels		105			144
Franchised hotels		91			119
Blended		92			120
	Quarter<br> Ended
---	---	---	---	---	---	---
	2022 Q2			2023<br> Q2
Occupancy rate (as a percentage)
Leased-and-owned hotels		57.1	%		74.6	%
Franchised hotels		62.3	%		77.9	%
Blended		62.2	%		77.8	%
Average daily rate (in RMB)
Leased-and-owned hotels		217			255
Franchised hotels		145			179
Blended		147			181
RevPAR (in RMB)
Leased-and-owned hotels		124			190
Franchised hotels		90			139
Blended		91			141

	Number<br> of Hotels in Operation				Number of<br> Hotel Rooms in Operation
	June 30,<br> 2022		June 30,<br> 2023		June 30,<br> 2022		June 30,<br> 2023
Mid-to-up-scale		528		438		47,347		42,338
GreenTree Eastern		201		217		22,402		23,205
Deepsleep Hotel		7		7		467		534
Gem		52		54		4,728		4,873
Gya		66		70		5,639		5,904
Vx		81		90		7,069		7,822
Urban Garden and others		121		-		7,042		-
Mid-scale		2,999		2,933		233,950		229,270
GreenTree Inn		2,183		2259		180,255		181,015
GT Alliance		521		545		37,545		39,091
GreenTree Apartment		19		21		1,260		1,351
Vatica		110		108		7,969		7,813
City 118 Selected and others		166		-		6,921		-
Economy hotels		1,142		737		50,776		31,779
Shell		648		737		28,030		31,779
City 118 and others		494		-		22,746		-
Total		4,669		4,108		332,073		303,387

Restaurant Operational Data

	June 30,<br> 2022		June 30,<br> 2023
Total restaurants in operation:		280		218
Leased and owned restaurants		146		104
Franchised restaurants		134		114
Number of cities		81		66
Da Niang Dumplings		245		182
Bellagio		35		36
Total restaurants in operation:		280		218
	Quarter<br> Ended
---	---	---	---	---
	2022 Q1		2023<br> Q1
ADT
Leased-and-owned restaurants		170		143
Franchised restaurants		95		81
Blended		130		110
AC (in RMB)
Leased-and-owned restaurants		51		61
Franchised restaurants		39		46
Blended		46		55
ADS (in RMB)
Leased-and-owned restaurants		8,640		8,716
Franchised restaurants		3,712		3,745
Blended		6,027		6,080
	Quarter<br> Ended
---	---	---	---	---
	2022 Q2		2023<br> Q2
ADT
Leased-and-owned restaurants		92		142
Franchised restaurants		56		86
Blended		78		120
AC (in RMB)
Leased-and-owned restaurants		60		61
Franchised restaurants		45		46
Blended		52		53
ADS (in RMB)
Leased-and-owned restaurants		5,505		8,657
Franchised restaurants		2,503		3,936
Blended		4,051		6,371