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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 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.
Revenue Revenue increased by 28.2% year-over-year, reaching RMB 5.8 billion. This growth was driven by strong performance across key brands and markets, including a 23% growth in the MINISO brand and a 111% growth in TOP TOY.
Gross Profit Margin (GP Margin) The GP margin remained stable at 44.7%, with gross profit reaching RMB 2.6 billion, a 27.6% increase year-over-year. This was attributed to increased contributions from international revenue and upgrades in IP strategy.
Adjusted Operating Profit Adjusted operating profit grew by 40.8% year-over-year, reaching RMB 1.02 billion. This marks the first time the adjusted operating profit crossed the RMB 1 billion threshold, supported by improved operational efficiency and revenue growth.
Adjusted Operating Margin Adjusted operating margin stood at 17.6%, showing sequential improvement from Q2. The decline in adjusted operating margin year-over-year was due to structural changes in revenue composition, with a higher proportion of international-directed operating revenue.
Same-Store Sales Growth (SSSG) Same-store sales growth reached mid-single digits overall. MINISO China achieved high single-digit growth, while international markets, including the U.S. and Canada, achieved low double-digit growth. This was driven by strategic product category focus and operational improvements.
MINISO China Revenue Revenue grew by 19.3% year-over-year, significantly outperforming China's total retail sales growth of 3.4% and online retail sales growth of 7.5%. Growth was driven by same-store sales increases and strategic operational enhancements.
MINISO International Revenue Revenue grew by 28% year-over-year, reaching RMB 2.3 billion. The U.S. market delivered over 65% revenue growth, with low double-digit same-store sales growth, supported by operational initiatives and store expansion.
TOP TOY Revenue Revenue surged by 111% year-over-year, reaching RMB 570 million. Growth was driven by enhanced product competitiveness, proprietary IP scaling, and significant gross margin optimization.
Inventory Turnover Inventory turnover for the MINISO brand was 87 days, an improvement from 104 days in Q1 and 94 days in Q2, reflecting efficient inventory management.
Cash Reserve Cash reserve stood at RMB 7.77 billion as of September 30, 2025, with net cash flow from operating activities reaching RMB 1.3 billion. This demonstrates strong cash flow management and operational efficiency.
Revenue growth: MINISO and TOP TOY brands demonstrated strong revenue growth, with MINISO growing by 23% and TOP TOY achieving 111% growth.
Proprietary IP: TOP TOY's proprietary IP contributed significantly to its growth, with immersive store experiences enhancing customer engagement.
International expansion: MINISO's international revenue grew by 28%, with a net addition of 170 stores in Q3. The U.S. market showed over 65% revenue growth and low double-digit same-store sales growth.
Store network: The global store network surpassed 8,000 locations, with significant expansions in both domestic and international markets.
Same-store sales growth: Same-store sales growth reached mid-single digits overall, with high single-digit growth in China and low double-digit growth in the U.S.
Profitability: Adjusted operating profit crossed RMB 1 billion for the first time, growing by 40.8%.
Channel upgrades: MINISO FRIENDS store format was introduced, emphasizing IP content and strategic channel segmentation.
IP strategy: The company expanded its proprietary IP portfolio, enhancing customer engagement and driving sales.
Geopolitical and Macroeconomic Uncertainties: The company acknowledges universal challenges posed by geopolitical and macroeconomic uncertainties, which could impact operations and financial performance.
Southeast Asia Market Challenges: The company faces operating challenges in Southeast Asia due to local macroeconomic downturns and social unrest, requiring channel, product assortment, and organizational upgrades.
International Directly Operated Stores: While international directly operated stores show growth, they face higher selling expenses and operational challenges compared to asset-light franchise models, impacting overall profit margins.
Tax Rate and Share-Based Compensation: The effective tax rate appears high due to non-deductible share-based compensation and losses from investments, which could affect net profitability.
Revenue Composition and Profit Margin: The increasing proportion of international directly operated revenue, which has lower profit margins compared to franchise models, is diluting overall profit margins.
Regional Economic and Social Environment: Operating in diverse countries and regions exposes the company to profit fluctuations due to varying economic and social conditions.
Revenue Growth: The company expects Q4 revenue growth to be around 25% to 30%, continuing to deliver on its commitment for a full-year revenue growth of 25%.
Same-Store Sales Growth (SSSG): For the full year, China and U.S. same-store sales are expected to grow by a mid-single-digit number. Q4 same-store sales in China and the U.S. are expected to achieve double-digit growth.
Operating Profit: Q4 operating profit is expected to register double-digit year-over-year growth. However, operating profit margin will decline modestly due to revenue structural changes.
North America Market: North America is expected to enter its peak shopping season, contributing to strong performance.
China Market: China's Q4 performance is expected to maintain rapid growth.
Southeast Asia Market: Continued macroeconomic weakness in Southeast Asia may bring some impact, but the company's global business layout is expected to diversify operating risks.
The selected topic was not discussed during the call.
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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