POP MART's "going global expectations" initially validated: overseas growth rate exceeds 2.5 times

On August 20th, POP MART (9992.HK) released its 2024 interim performance. It achieved a revenue of 4.558 billion yuan, a year-on-year increase of 62%; the adjusted net profit was 1.02 billion yuan, a year-on-year increase of 90.1%.

In terms of IP, POP MART had 7 IPs with revenue exceeding one billion in the first half of the year. The top three IPs MOLLY, THE MONSTERS, and SKULLPANDA contributed revenues of 782 million, 627 million, and 575 million yuan respectively.

The reason lies in the fact that, apart from blind box products, POP MART, positioned as an IP operation company, has more IP monetization methods.

In its interim report, POP MART disclosed the revenue data of businesses other than figurines for the first time.

Figurine products contributed revenue of 2.657 billion yuan, with the income proportion falling below 60% for the first time; the high-end toy MEGA series contributed revenue of 586 million yuan, with an income proportion of 12.9%; plush toys contributed revenue of 446 million yuan, with an income proportion of 9.8%, nearly 10 times year-on-year growth; derivative products and other items contributed revenue of 867 million yuan, with an income proportion reaching 19%.

In June this year, POP MART's self-developed game "Dream Home" went online, marking another important attempt at IP monetization.

According to Sensortower data, the game has currently generated $1 million in revenue on the iOS platform.

In terms of profit performance, POP MART's gross profit margin in the first half of the year increased by 3.6 percentage points year-on-year to 64%, attributed in the interim report to strengthened cost control, growth in the Hong Kong, Macao, Taiwan, and overseas markets, and a reduction in the proportion of externally sourced goods.

The change in gross profit margin may also be related to adjustments in product structure.

When asked by user TradeWind01 about whether plush toys and other products are higher than figurine products, POP MART personnel only stated that there is currently no comparative data available.

In terms of regions, management's expectations for overseas business seem to be materializing.

In the first half of the year, the mainland Chinese market contributed revenue of 3.206 billion yuan to POP MART, a year-on-year increase of 31.5%, accounting for 70.3% of revenue; while the Hong Kong, Macao, Taiwan, and overseas markets contributed revenue of 1.352 billion yuan, a year-on-year increase of 259.6%.

In this interim performance, POP MART disclosed the performance of major overseas regions for the first time.

Among them, the Southeast Asian market achieved revenue of 560 million yuan, accounting for 41.1%, with the fastest growth rate reaching 478.3%; the East Asia and Hong Kong, Macao, Taiwan region achieved revenue of 480 million yuan, accounting for 35.4%; the North American market achieved revenue of 180 million yuan, accounting for 13.2%; the Europe, Australia, and other markets achieved revenue of 140 million yuan, accounting for 10.3%.

POP MART's overseas expansion still focuses on offline store openings. The number of overseas retail stores increased by 45 year-on-year to 83, with retail store revenue increasing by 441.5% year-on-year to 894 million yuan.

This is reflected in POP MART's expenses, with expenses related to "expenses not included in lease liabilities and expenses related to short-term leases and variable leases" increasing by 146.97% year-on-year to 163 million yuan.

On August 20th, POP MART's stock price hit a new high for the year at 42.95 Hong Kong dollars per share during trading hours, closing up 0.84% at 41.85 Hong Kong dollars per share, with a year-to-date increase doubling