(Yicai Global) Feb. 27 -- Haidilao International Holding surged as much as 20.1 percent today after the Chinese hotpot chain reported a profit in 2022, after racking up huge losses in 2021, thanks to a drastic reduction in the number of poorly performing stores and other measures to improve efficiency. And this year should be even better, it said.

Haidilao’s share price [HKG:6862] was trading up 13.7 percent at HKD21.90 (USD2.80) as of 1.45 p.m. China time today. Earlier in the day it hit HKD23.15.

Haidilao raked in no less than CNY1.3 billion (USD186.6 million) in net profit last year, a huge improvement on the net loss of CNY4.2 billion logged a year earlier, the Beijing-based company said in a filing to the Hong Kong bourse on Feb. 24, citing unaudited data. But revenue plunged as much as 15.8 percent to CNY34.6 billion (USD5 billion) due to the reduced number of outlets.

Haidilao closed over 300 loss-making restaurants in the second half of 2021 after a spree of overaggressive expansion coupled with the impact of the Covid-19 pandemic left the restaurant chain mired in debt.

This year, business should improve even more now that pandemic prevention measures have been relaxed, Haidilao said.

The company, which was founded in Jianyang, southwestern Sichuan province in 1994, also gained CNY329 million (USD47.2 million) by cancelling outstanding notes it repurchased last year.

Editor: Kim Taylor