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01/11 04:03
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call reveals strong financial performance with 23% revenue growth, improved profit margins, and a 70% increase in operating profit. The company is expanding its US presence and optimizing store formats, suggesting potential for future growth. Despite high expenses, cash reserves are robust. The shareholder return plan, including share repurchases and dividends, is positive. The Q&A section highlights growth strategies and optimism for 2025. Overall, the positive financial results and strategic initiatives outweigh any concerns, leading to a positive sentiment.
Total Revenue RMB 17 billion, grew by 23% year-over-year, driven by 80% growth in average store count despite a low single-digit decline in same-store sales.
MINISO Brand Revenue RMB 16 billion, up by 22% year-over-year, with MINISO mainland China revenue at RMB 9.3 billion, growing by 11%, and MINISO Overseas revenue at RMB 6.7 billion, increasing by 42%.
Gross Profit Margin 44.9%, improved by 3.7 percentage points year-over-year, due to revenue structure adjustment and effective IP strategy.
Adjusted Operating Profit Increased by 70% year-over-year, with an adjusted operating profit margin stabilized around 20%.
Adjusted Net Profit RMB 2.72 billion, grew by 15% year-over-year, with an adjusted net profit margin of 16%.
Adjusted EBITDA Grew by 21% year-over-year, with an adjusted EBITDA margin of 25.5%, essentially flat compared to 2023.
Sales and Administrative Expenses Increased by 52% year-over-year, with sales expenses growing by 59% and administrative expenses by 29%, primarily due to newly opened stores.
Net Operating Cash Flow RMB 2.17 billion for the year.
Free Cash Flow Approximately RMB 1.4 billion.
Cash Reserves Nearly RMB 6.7 billion, including RMB 6.23 billion in cash and cash equivalents.
Dividend Distribution Final dividend of approximately RMB 740 million, representing 50% of adjusted net profit for H2 2024.
Inventory Turnover Days 91 days, with Mainland China at 75 days, up from 70 days year-over-year.
Directly Operated Stores in US More than 500 stores, doubling from the previous year, with revenue from these stores also doubling.
License Fee Increased by 29% year-over-year, primarily due to a higher proportion of IP product sales.
Logistic Expenses Rose by 51% year-over-year, driven by the increase in overseas stores and rising international freight costs.
Convertible Bonds Issued US$550 million with a coupon rate of 0.5%, aimed at supporting overseas market expansion and shareholder returns.
New Product Launches: In 2024, MINISO planned more than 90 IP launch discoveries, focusing on both evergreen and potential strong-characterized IPs.
Product Differentiation Strategy: TOP TOY's product differentiation strategy led to a gross margin improvement of 7.3%.
Store Expansion: By the end of December 2024, MINISO had a total of 7,780 stores, with a net increase of 1,219 stores, including 631 overseas stores.
Overseas Revenue Growth: Overseas revenue reached RMB 6.68 billion, representing a 42% growth.
US Market Expansion: In 2024, MINISO added 154 stores in the US, bringing the total to 275 locations across 47 states.
UK Market Performance: The UK market leveraged MINISO's IP strategy to drive channel upgrades, achieving triple-digit GMV growth.
Operational Efficiency: The average daily sales per newly opened store in 2024 were low double-digit higher than those opened in 2023.
Inventory Management: MINISO's inventory turnover days was 91 days, with 33% of inventories located overseas.
Global Strategy: MINISO's global strategy includes diversifying the supply chain and reducing dependence on Mainland China.
Acquisition of YH: MINISO completed the acquisition of a 29.4% equity stake in YH, aiming for deeper synergies.
Competitive Pressures: The company faces competitive pressures in the retail market, particularly in the US and overseas markets, where it aims to maintain rapid expansion and improve store quality.
Regulatory Issues: The company is navigating complex geopolitical landscapes and tariff policies, which could impact costs and supply chain operations.
Supply Chain Challenges: MINISO is working to diversify its global supply chain to reduce dependence on Mainland China, with a goal of achieving 40% local direct sourcing in the US.
Economic Factors: The company acknowledges economic uncertainties and is implementing cost control measures to mitigate potential impacts on profitability.
Operational Efficiency: The rapid expansion of directly operated stores has led to increased sales and administrative expenses, which the company is managing through improved operational efficiency.
Inventory Management: The company is optimizing its inventory management strategy to respond to tariff risks and reduce inventory risks.
Store Expansion: By the end of December 2024, MINISO's total store count reached 7,780, with a net increase of 1,219 stores, exceeding opening targets.
Global Market Development: Overseas operations contributed nearly 40% of total revenue, with a revenue growth of 42% in overseas markets.
IP Collaboration: Planned over 90 IP launches in 2025 to enhance product offerings and drive sales.
Member Loyalty: Global registered membership surpassed 100 million, with members accounting for over 60% of total sales.
Localization Strategy: Achieved 100% localization of store managers in directly operated markets, particularly in Thailand.
Supply Chain Diversification: Reduced dependence on Mainland China for sourcing, with nearly 40% local direct sourcing in the US.
TOP TOY Growth: TOP TOY contributed 45% to overall growth, with a net increase of 128 stores and improved gross margins.
Revenue Growth Outlook: Expect accelerated revenue growth in 2025, with a focus on same-store sales and overseas market development.
Store Count Target: Plans to double store count by the end of 2028 compared to the end of 2023.
Operating Profit Margin: Expect operating profit margin to stabilize around 20% in the mid to long term.
Capital Allocation: 50% of adjusted annual net profit will be distributed as dividends, with a focus on shareholder returns.
2025 Revenue Growth: Revenue growth in 2025 is expected to be lower in H1 and higher in H2 due to base effects from 2024.
Final Dividend for FY 2024: Approximately RMB740 million, representing 50% of adjusted net profit for H2 of 2024.
Total Dividends for FY 2024: Approximately RMB1.24 billion, representing 50% of the corresponding adjusted net profit.
Future Dividend Payout Ratio: The company will maintain a dividend payout ratio of 50% in the near future.
Share Repurchase Program: Canceled more than 11 million ordinary shares in 2024, accounting for around 9% of total shares.
Total Returns to Shareholders: Combined with the share purchase, a total of RMB1.57 billion was returned to shareholders.
Convertible Bonds Issued: Issued a seven-year convertible bond valued at US$550 million, with 50% allocated for shareholder return.
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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