Miniso Q1 revenue hits a record high, with the fastest quarterly store expansion speed | Financial Report Insights

On May 14th, Miniso Group announced its financial report for the first quarter of 2024.

The data shows that this is the first quarter where Miniso achieved its highest revenue and fastest store expansion rate. The company's overseas market revenue grew by 53% year-on-year, exceeding the company's most optimistic expectations and setting a new record for the first quarter. Among them, overseas direct-operated stores have seen growth of over 80% for four consecutive quarters. Additionally, the TOP TOY brand has been profitable for two consecutive quarters.

Financial report highlights:

• Total revenue in the first quarter increased by 26% year-on-year to 3.72 billion RMB, a 26% increase year-on-year;
• Gross profit margin was 43.4%, up 4.1 percentage points from 39.3% in the same period last year;
• Net profit for the period was 586 million RMB, a 24.4% increase year-on-year;
• Adjusted net profit was 617 million RMB, a 27.7% increase year-on-year.

Revenue increased by 26.0% year-on-year, reaching a new high for the first quarter, mainly due to a 19.3% year-on-year increase in the average number of stores at the group level and approximately 9% growth in same-store sales.

Benefiting from the increase in the proportion of direct-operated markets in overseas revenue and the optimization of TOP TOY's gross profit margin, the company's gross profit margin for the quarter was 43.4%, up 4.1 percentage points year-on-year, once again hitting a historical high.

This quarter also marks the fastest-ever expansion rate for Miniso. However, the capital market does not seem to be impressed by Miniso's performance, as Miniso's Hong Kong stock closed down by 0.40% on the day.

As of the time of writing, Miniso's US stock has fallen by nearly 6% in pre-market trading.

Fastest Expansion Quarter in History

Mr. Ye Guofu, founder, chairman, and CEO of Miniso, stated in the financial report conference call:

The past three months have been the fastest quarter in terms of our store expansion, laying a solid foundation for us to achieve our goal of net adding 900 to 1100 new stores in 2024.

According to the financial report, as of March 31, 2024, Miniso had a total of 6,630 global stores.

This quarter saw a net addition of 217 stores, nearly tripling the growth compared to the same period last year.

Among them, the number of domestic stores exceeded 4,000 for the first time, reaching 4,034 stores, with a net addition of 108 stores in the first quarter, nearly double the growth from the same period last year, contributing to part of the domestic revenue growth In the first quarter, revenue from mainland China increased by 16.2% year-on-year to RMB 2.502 billion, contributing over 60% of the first quarter revenue. This growth was driven by an 18.7% year-on-year increase in average store count, with same-store sales reaching approximately 98% of the high base of the same period last year.

Smooth Overseas Expansion, Overseas Direct Operations Grow by Over 80% for Four Consecutive Quarters

Revenue from overseas markets increased by 52.6% year-on-year to RMB 1.222 billion, accounting for 32.8% of total revenue in the first quarter. This proportion significantly increased compared to 27.1% in the same period of 2023, with both store count and same-store performance growing rapidly.

In terms of store count, there are 2,596 overseas stores, with a net increase of 109 stores in the first quarter, a multiple increase compared to the addition of only 16 stores in the same period last year. Additionally, same-store sales grew by approximately 21%. Revenue from overseas direct operations accounted for about 58% of the total overseas market revenue in the quarter of March, which is also worth noting.

Mr. Ye Guofu, the founder, chairman, and CEO of Miniso, stated:

Revenue from overseas markets increased by 53% year-on-year, exceeding our most optimistic expectations and setting a new record for the first quarter. This is mainly due to a 92% year-on-year growth in revenue from our direct operations, which has seen growth of over 80% for four consecutive quarters.

Looking at the structure of overseas revenue, the United States and Asia are the two major markets for Miniso's overseas expansion, accounting for nearly 3/4 of overseas GMV, with overall sales growth mainly relying on increased foot traffic. In the consumer-strong U.S. market, same-store sales in the region grew by 30% to 40% year-on-year in the first quarter of this year.

TOP TOY Achieves Profit for Two Consecutive Quarters

In addition to the Miniso brand, the TOP TOY brand is also making continuous efforts.

Data shows that as of March 31, the cumulative number of TOP TOY stores reached 160, an increase of 44 stores year-on-year and 12 stores quarter-on-quarter. In terms of performance, TOP TOY achieved revenue of RMB 214 million this quarter, a year-on-year increase of 55.1%, reaching a historical high.

On the revenue front, TOP TOY achieved revenue of RMB 138 million in the first quarter, a year-on-year increase of 55.1%; the average store count increased by 32.2% year-on-year, and same-store sales grew by approximately 26% compared to the same period in 2023.

At the same time, TOP TOY's business gross profit margin increased by 8 percentage points year-on-year and has achieved positive profitability for two consecutive quarters, a key turning point in the brand's development according to Miniso's management.

During the financial report conference call, Ye Guofu revealed, "We have stronger confidence in the rapid expansion of TOP TOY, so the target for new store openings this year has been raised from 50 stores at the beginning of the year to 100 stores. By the end of 2024, the number of TOP TOY stores is expected to expand to over 250."

Looking ahead, Ye Guofu stated:

We have the necessary patience and perseverance, and are firmly committed to long-termism, proceeding cautiously and diligently to achieve our five-year development plan, maintaining a compound annual growth rate of no less than 20% in revenue