Small Garden Rises Over 5% Mid-term Profit Allocation to Shareholders Increases by 35.7%

Small Garden (00999) has risen over 5% on the market, with a price increase of 2.29% as of the reporting date, now standing at HK$10.71, and trading volume reaching HK$4493.983 million.

Recently, Small Garden released its half-year results for the period ending June 30, 2025, with revenue of RMB27.14 billion, up 6.5% year-on-year; earnings per share (EPS) allocated to shareholders reached RMB3.82 billion, up 35.7%; basic EPS was HK$0.33 per share; and a mid-term dividend of HK$0.2119 per share is expected to be distributed.

The announcement stated that the increase in revenue primarily reflected the growth of dine-in business, which increased by RMB355 million, as well as take-out business, which grew by RMB1.28 billion. The growth in dine-in business was mainly driven by the expansion of retail stores, with the group having 672 operating "Small Garden" stores as of June 30, 2025, up from 617 stores at the same point last year.

Credit Suisse noted that Small Garden's management team emphasized focusing on product value and restaurant profitability, with a target payout ratio of 50% to 60%. The bank pointed out that the company's same-store sales have been positive since May, with store numbers reaching 672, and the management team maintained its targets for 800 stores by the end of 2025 and 1,000 stores by the end of 2026.