Tims China achieves record revenues in strong second quarter

Customers inside a Tims China store in Yinchuan | Photo credit: Tims China

Tims China has achieved record revenues for the second consecutive quarter this year. 
 

Reporting on the three months ended 30 June 2023, Tims China posted 130% year-on-year sales growth to reach RMB 411.7m ($56.8m) – 22% higher than the RMB 336.5m ($47.5m) achieved in the first quarter. 

The licensee opened 52 net new Tim Hortons stores during the period to reach 700 outlets across China. 

Sales from Tim China’s 571 company operated coffee shops totalled RMB 362.6m ($50m), 120% higher than the same period last year. Second quarter like-for-like sales growth reached 20%. 

Tims China’s loyalty scheme membership also continues to grow, with 2.3 million new registrations in the second quarter to reach 14.7 million members. Membership is 95% higher than the corresponding period in 2022. 

However, highlighting the growing cost of Tim Hortons’ rapid expansion in China, the business posted a RMB 227.7m ($31.4m) second quarter net loss, compared to a RMB 174.5m ($23.9m) net loss in the previous quarter and RMB 175.6m ($24m) during the same quarter of 2022.  

Among the highest expenses, food and packaging costs increased 109% year-on-year to RMB 123.4m ($17m), rental and property management fees grew 31% to RMB 75.3m ($10.4m) and payroll and employee benefits expenses rose 23% to RMB 79.4m ($10.9m). 

“In the second quarter, we delivered 129.7% year-over-year top-line growth, achieving a record quarterly revenue of over RMB 400m ($54.9m), driven both by new store openings and continued strong same-store traffic and sales growth. We continued to build density in our existing cities and penetrate new cities such as Yantai, Taizhou, Changzhou. At the same time, we achieved greater capital efficiency via increasing franchise development, notably through the rapid expansion of Tims Express, our most compact store format,” said Yongchen Lu, CEO & Director of Tims China. 

In August 2023, Tims China opened its first Popeyes outlet in Shanghai. Lu said adding the fast-food chain to its portfolio will deliver ‘economies of scale and supply chain synergies’ for both brands. 

Tims China plans to open at least 10 Popeyes restaurants in Shanghai this year as part of plans to reach 1,700 across China over the next 10 years.