TH International Limited manages Tim Hortons coffee establishments across mainland China, Hong Kong, and Macau. By September 28, 2022, the company had ...
TH International Limited (THCH), known as Tims China, is headquartered in Shanghai, China, and is focused on the Tim Hortons quick-service coffee business within its designated territories—mainland China, Hong Kong, and Macau. Under its master franchise structure, the company serves as the parent entity for exclusive master franchisees, enabling it ...TH International Limited (THCH), known as Tims China, is headquartered in Shanghai, China, and is focused on the Tim Hortons quick-service coffee business within its designated territories—mainland China, Hong Kong, and Macau. Under its master franchise structure, the company serves as the parent entity for exclusive master franchisees, enabling it to develop, operate, and franchise coffee shops that trade under the Tim Hortons brand.
From a business-model perspective, TH International’s model combines company-operated stores with franchised locations. This structure typically means that the company participates in revenue generation in two ways: (1) direct operational income from stores it operates and (2) franchise-related income streams, such as franchise fees and related brand/operating support arrangements, depending on the specific franchise agreements and store mix. The company’s operational focus is therefore closely tied to store rollouts, standardization of the customer experience, supply-chain execution, and sustaining brand compliance across a growing network.
Regarding products and services, the company’s core offering is Tim Hortons-branded coffee and related menu items common to the brand (coffee beverages, baked goods, and food items). For store-level operations, a key cost foundation generally includes labor, rent/lease costs, utilities, and food/packaging inputs (often purchased or managed via centralized supply arrangements typical for QSR/franchise systems). While detailed BOM (bill of materials) breakdowns are not provided in the supplied data, the company’s performance indicators point to the importance of disciplined input and operating cost management to support margins, especially during expansion periods.
Financially, the supplied trailing-twelve-month metrics show relatively weak profitability signals: gross margin is reported around 7.8% and operating/net profit margins are negative (e.g., net profit margin about -42%). Cash-flow-related ratios also reflect challenges, with negative free cash flow and negative operating cash-flow coverage figures in the dataset snapshot. Working capital and invested-capital figures are also negative in the provided financial snapshot, which can occur in certain fast-growing retail/restaurant franchise ecosystems due to payables-driven working-capital patterns and accounting/network buildout dynamics. For investors and management, these metrics typically translate into an emphasis on store productivity, channel mix optimization, and improvement in unit economics (store-level margins and cash generation).
Key leadership includes CEO Kwok Wah Cheung (serving as CEO since mid-2026 per the provided sources). On the growth narrative, the company reports expansion from early China rollout efforts to a large footprint; the sources also mention over 1,000 locations across multiple cities (as of March 31, 2026), underscoring an expansion-focused strategy.
In terms of “wishes” or strategic priorities implied by the business and the financial snapshot, TH International’s near- to medium-term goals would likely include (a) stabilizing and improving margins through cost control and menu/channel optimization, (b) sustaining franchise/store growth without overextending the balance sheet, and (c) improving cash generation and financial leverage metrics as the network matures.
Overall, TH International Limited is best characterized as a region-focused QSR franchising/operator platform for Tim Hortons, where commercial success depends on effective franchise governance, store expansion execution, supply-chain and input-cost discipline, and improving unit-level profitability as the network scales.
YoYYoY means Year-over-Year. It compares the latest annual value with the previous annual value to show long-term trend strength.
QoQQoQ means Quarter-over-Quarter. It compares the latest quarter with the immediately previous quarter to show short-term momentum changes.
RevenueThe total money that came through the front door from selling things, before paying a single bill. Think of it as the grand total of every credit card swipe from customers. (YoY compares this year to last year's performance, while QoQ compares the current three months to the previous three).
$1.3B
-8.0%
+6.8%
Net IncomeThe absolute bottom line. If the company paid every single supplier, employee, banker, and tax collector, this is the actual money left in their pocket at the end of the day.
$-422.7M
-2.6%
+11.0%
Gross MarginThe basic markup. If they sell a $100 pair of sneakers, this percentage tells you how much of that price tag is profit right after paying for the rubber and shoelaces, but before paying for things like store rent or TV commercials.
+6.1%
-60.5%
+157.6%
Operating MarginThe 'day job' efficiency score. Out of every dollar a customer spends, this shows how many cents the company keeps after making the product AND paying for all the everyday corporate overhead (like salaries, marketing, and keeping the lights on).
-19.3%
+7.0%
+22.0%
Net MarginThe final take-home percentage. When you strip away every conceivable cost, tax, and interest payment, this is the exact number of cents the company truly gets to keep from every dollar in sales.
-33.0%
-11.4%
+16.7%
Free Cash FlowThe holy grail of corporate cash. It's the spendable, physical money left over after the business pays for its daily operations AND buys the big, expensive upgrades (like new factories or servers) it needs to survive. This is the 'free' money they can use to pay dividends or buy back stock.
$-78.3M
+45.0%
-288.4%
FCF MarginThe ultimate cash conversion rate. It shows how good the company is at turning regular sales directly into cold, hard, spendable cash. A high percentage means the business is an absolute cash-printing machine.
-6.1%
+40.3%
-263.6%
Debt / EquityThe financial risk gauge. It compares how much of the company's empire was built using borrowed money (loans) versus the owners' own money (shareholders). A high number means they are heavily leveraged and playing a riskier game; a low number means they are playing it safe.
-158.4%
+29.1%
+4.2%
Current RatioThe 12-month survival check. It simply compares the cash they have right now (plus things they can quickly turn into cash) against the immediate bills they absolutely must pay this year. A score above 1 means they have enough in the wallet to cover the upcoming bills without panicking.
0.33x
+20.0%
-1.4%
Total AssetsThe absolute size of the company's empire. It bundles together absolutely everything of value they own—from the cash in the register and the inventory in the warehouse, to the software patents in the vault and the factories on the ground.
Operator: Ladies and gentlemen, welcome to the Tims China's Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Today's conference is being recorded. At this time, I would like to turn the call over to Patty Yu, Tims China's Public and Media Relations Manager for prepared remarks and introductions. Please go ahead, Patty.
Patty Yu: Hello, everyone, and thank you for joining us on today's call. TH International Limited announced its second quarter 2026 financial results earlier today. A press release as well as the company's presentation, which includes operational and financial highlights are now available on the company's IR website at ir.timschina.com. Today, you will hear from Mr. John Cheung, our CEO; and Albert Li, our CFO. After the company's prepared remarks, the management team will conduct a question-and-answer session. You will find the webcast of today's earnings call on our IR website. Before we get started, I would like to remind you that our earnings presentation and the investor materials contain forward-looking statements, which are subject to future events and uncertainties, statements that are not historical factors, including but not limited to statements about the company's beliefs and expectations are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and our actual results may differ materially from those forward-looking statements. All forward-looking statements should be considered in conjunction with the cautionary statements in our earnings release and the risk factors included in our findings with the SEC. This presentation also includes certain non-GAAP financial measures, which we believe can be helpful in evaluating our performance. However, those measures should not be considered substitutes for the comparable GAAP measure. The upcoming reconciliation information related to those non-GAAP and GAAP measures can be found in our earnings press release issued earlier day. With that said, I would like now to turn it over to John Cheung, our CEO. Please go ahead, John.
Kwok Wah Cheung: Well, thank you, Patty. Good morning, good evening, everyone. Thank you for joining us today. Tim Hortons is one of the world's top 10 most valuable restaurant brands, and China represents one of the most compelling consumer market. It's truly a privilege to take on this role as the CEO of Tims China. I'm truly excited and honored to be here, and I'm very passionate about our future. Since joining the company, well, in fact, I have to say even before joining the company in mid-June, I spent a lot of my time diving into the business, visiting stores and suppliers, talking to our barristers and store managers, hearing from our partners, and most importantly, connecting with our customers. These learnings have helped me having a strong grip of where we are and what we need to do differently moving forward. Everything I've seen and heard tell me we have significant strength to …
