Tims China posts second consecutive quarter of record sales

Tims China opened 59 net new Tim Hortons stores during the period to reach 756 outlets | Photo credit: Tims China

Tims China has posted record third quarter revenues following sustained Tim Hortons outlet growth and rising loyalty membership. 
 

Tims China achieved 43% year-on-year sales growth to reach RMB 436.4m ($59.8m) during the third quarter ended 30 September 2023 – 5% higher than its previous quarterly record of RMB 411.7m ($56.8m) in the three months prior. 

Adjusted store EBITDA also reached a record high during the quarter, increasing 91% year-on-year to RMB29.3m ($4m). 

Tims China opened 59 net new Tim Hortons stores during the period to reach 756 outlets – with its 580 company-owned stores generating nearly 90% of sales. 

“We also rapidly expanded our Tim Hortons franchised store network, driving capital efficient growth, and penetrated new cities such as Yibin, Handan, and Lanzhou, among others,” CEO Yongchen Lu said in a press release. 

Read related content: Tims China: coffee, convenience and e-commerce

The coffee chain’s Tims Club loyalty scheme reached 16.9 million members during the period – 15% higher than the previous quarter and 90% higher than the same period in 2022. 
 

Eighty-two percent of orders were made digitally, with delivery and takeaway sales increasing 63% year-on-year. 
 

Tims China also launched 21 new beverages during the quarter, including buffalo milk latte, which sold 528,000 cups during the quarter, and a watermelon cold brew. Cold brew sales also exceeded four million cups during the period. 

“Looking forward, one of our top near-term priorities is to drive capital-efficient growth via building density in our existing markets, entry into attractive new cities, and accelerating our use of sub-franchising. We are also squarely focused on profitability, as is demonstrated in our continuously improving margins,” said Dong Li, Chief Financial Officer, Tims China. 

Tims Hortons' strong third quarter comes as the China's largest coffee chains have posted record sales and outlet growth. 

Market leader Luckin Coffee posted its highest-ever quarterly revenues for the third quarter, with sales reaching RMB 7.2bn ($987m) and operating income of RMB 961m ($132m). The value-focused coffee chain also maintained its rapid outlet expansion, opening 2,437 stores in the quarter to reach 13,273 sites. 

Starbucks’ sales in China increased 8% in its fourth quarter to $841m. The Seattle-based coffee chain opened 326 net new stores in China to reach 6,806 as it seeks to open a further 2,200 outlets across the country by 2025.   

Luckin Coffee rival Cotti Coffee has also rapidly expanded to around 6,200 outlets since late 2022 and has since opened stores in South Korea, Indonesia, Japan and Canada.