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01/11 04:06
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call highlights strong revenue growth, improved margins, and effective strategies for market expansion, particularly in the U.S. and overseas markets. Positive same-store sales in China and a robust cash reserve further enhance the outlook. While there are some concerns over management's lack of clarity in certain areas, the overall sentiment remains positive, supported by optimistic guidance and strategic IP development. These factors suggest a likely positive stock price movement in the short term.
GMV Grew by 21% year-over-year in Q2 2025. This growth was attributed to accelerated performance compared to Q1 and positive same-store sales growth after four consecutive quarters of decline.
Revenue Grew by 23.1% year-over-year in Q2 2025, reaching RMB 4.97 billion. This exceeded the upper limit of guidance (18%-21%). The growth was driven by strong performance across all business segments, including MINISO and TOP TOY brands.
MINISO Brand Revenue Grew by 20% year-over-year in Q2 2025, reaching RMB 4.56 billion. Mainland China revenue grew by 14% to RMB 2.62 billion, while overseas revenue grew by 29% to RMB 1.94 billion. Growth was driven by channel upgrades, product mix optimization, and operational improvements.
TOP TOY Revenue Achieved 87% year-over-year growth in Q2 2025, reaching RMB 400 million. Growth was attributed to effective product differentiation strategy and product power improvement.
Gross Margin Improved to 44.3% in Q2 2025, up 0.4 percentage points year-over-year. The improvement was driven by increased contribution from overseas revenue and optimization of TOP TOY's gross profit margin.
Adjusted Operating Profit Reached RMB 850 million in Q2 2025, up by 8.5% year-over-year. Adjusted operating margin improved to 17.2%, driven by peak season sales and operational efficiency.
Same-Store Sales (China) Turned positive in Q2 2025 after four consecutive quarters of decline. This was attributed to channel upgrades, product mix optimization, and operational improvements.
Overseas Revenue Grew by 28.6% year-over-year in Q2 2025, reaching RMB 1.9 billion. U.S. revenue grew by over 80%, driven by same-store improvement and high-quality new store openings.
Inventory Turnover Days Improved to 93 days as of June 30, 2025, compared to 102 days in the previous quarter. This was achieved through SKU management, category standardization, and dynamic inventory monitoring.
Cash Reserve Stood at RMB 7.47 billion as of H1 2025. Net cash flow from operating activities improved significantly, reaching RMB 1.01 billion in H1 2025.
New Product Launches: MINISO launched proprietary IP products, including the successful 'Yu Yu Chan' pop toy artist IP, which sold out quickly and marked a significant step in proprietary IP development. The company plans to bring 100 Chinese IPs overseas.
Product Differentiation: TOP TOY implemented a product differentiation strategy, improving product power and achieving significant GP margin improvement.
Market Expansion in the U.S.: U.S. revenue grew by over 80%, driven by same-store improvement and high-quality new store openings. 37 net new stores were added, with higher sales efficiency and sales per square meter than existing stores.
Global Store Expansion: MINISO added 94 new stores overseas in Q2, with plans to add over 500 stores globally in 2025. The company is focusing on flagship and large stores for higher efficiency.
Operational Efficiency: Inventory turnover days improved to 93 days from 102 days in the previous quarter. Cash flow from operating activities increased significantly, reaching RMB 750 million in Q2.
Channel Upgrades: Channel upgrades in China led to double-digit revenue growth despite moderate store additions, demonstrating the effectiveness of the strategy.
Large Store Strategy: MINISO's large store strategy, including MINISO LAND and flagship stores, contributed significantly to revenue and efficiency. These stores accounted for 5% of total stores in China but contributed mid-double-digit growth.
Proprietary IP Strategy: The company is focusing on proprietary IP development as a long-term growth driver, leveraging its global supply chain and operational capacity to build an IP ecosystem.
Channel Upgrades: Concerns about short-term impact of channel upgrades, though the company views it as necessary for long-term growth.
Overseas Market Expansion: Cautious approach to overseas market expansion, with a revised target for directly operated stores from 40% to 35% due to CapEx concerns and focus on operational optimization.
Profitability in Overseas Markets: Decline in overseas operating margin due to structural changes in revenue, with more contribution from directly operated stores.
GP Margin Fluctuations: Potential fluctuations in GP margin due to category structure changes and business seasonality.
Expense Growth: Significant increase in selling and administrative expenses, particularly related to directly operated stores.
Inventory Management: Need for efficient inventory turnover and SKU management to maintain working capital efficiency.
Investment in Proprietary IP: Upfront investment in proprietary IP and related R&D, which may take time to yield returns.
Economic and Market Conditions: Dependence on consumer spending trends and economic conditions, particularly in key markets like China and the U.S.
Operating Margin: Expected to improve in H2 2025 due to peak season sales.
Revenue Growth: H2 2025 revenue growth expected to accelerate, progressing towards the guidance provided earlier in the year. Full-year 2025 revenue growth projected to be no less than 25%.
Same-Store Sales: Positive growth expected in H2 2025, with low single-digit growth projected for Q3.
Overseas Market Expansion: Plan to add over 500 new stores in 2025, with 35% being directly operated. Focus on operational optimization of existing stores.
Large Store Strategy: Continued optimization and refinement of the large store strategy globally, serving as a key platform for IP strategy and growth.
Proprietary IP Development: Plans to deepen proprietary IP strategy, including expanding IP ecosystem and leveraging artist IPs for global markets.
Adjusted Operating Profit: Projected to grow by double digits in H2 2025. Full-year adjusted operating net profit expected to be RMB 3.65 billion to RMB 3.85 billion.
Gross Profit Margin: Expected to remain upward due to increased contribution from overseas revenue and IP sales.
Capital Allocation: Commitment to distribute 50% of annual adjusted net profit as dividends and continue dynamic share buybacks.
Dividend Distribution: In H1 of 2025, the company returned RMB 1.07 billion to shareholders through dividends and share buybacks, representing 84% of the H1 adjusted net profit. The company remains committed to distributing 50% of the annual adjusted net profit as dividends.
Interim Dividend: The company announced a 2025 interim dividend of RMB 640 million, accounting for 50% of the adjusted net profit, to be paid after September.
Share Buyback Program: In H1 of 2025, the company repurchased shares worth more than RMB 340 million, representing 1% of outstanding shares. This amount exceeds the total repurchase of the entire last year. The repurchased shares will be canceled.
Future Share Buyback Plan: The Board has agreed to utilize authorization to repurchase up to 10% of the total outstanding shares through the Hong Kong repurchase plan and rule 10b5-1 repurchase plan in the near future.
The earnings call summary indicates strong financial performance with significant revenue growth across various segments and improved inventory turnover. The Q&A section highlights strategic initiatives in international markets and proprietary IP development, although some responses lacked specific timelines. The strategic plan outlines robust revenue and profit growth expectations, and shareholder return plans are favorable. Overall, the combination of strong current performance and positive future guidance suggests a positive stock price movement, despite some uncertainties in management's responses.
The earnings call highlights strong revenue growth, improved margins, and effective strategies for market expansion, particularly in the U.S. and overseas markets. Positive same-store sales in China and a robust cash reserve further enhance the outlook. While there are some concerns over management's lack of clarity in certain areas, the overall sentiment remains positive, supported by optimistic guidance and strategic IP development. These factors suggest a likely positive stock price movement in the short term.
The earnings call highlights robust financial performance, with a 90% revenue growth and increased gross margins. The global expansion strategy is effective, and there is a strong focus on IP collaborations and same-store sales improvement. Despite increased expenses, the adjusted EBITDA margin shows improved efficiency. The company is committed to shareholder returns with dividends and share repurchases. Q&A insights reinforce confidence in domestic and overseas markets, and strategic responses to tariff fluctuations and YH acquisition are promising. These factors indicate a strong positive sentiment, likely leading to a stock price increase over 8%.
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