Yesterday evening (29th), Miniso released its third quarter financial report as of September 30, 2024.
According to the financial report, Miniso's third quarter revenue was 4.523 billion yuan (approximately 645 million US dollars), a year-on-year increase of 19.3%; The profit during the period was 648 million yuan (92.4 million US dollars), a year-on-year increase of 4.9%; Adjusted EBITDA was RMB 1.14 billion (USD 162 million), a year-on-year increase of 12.4%.
The revenue for the first nine months of this year was 12.281 billion yuan (1.75 billion US dollars), a year-on-year increase of 22.8%; The profit during the period was 1.826 billion yuan (approximately 260 million US dollars), a year-on-year increase of 11.6%; The adjusted net profit was 1.928 billion yuan, an increase of 13.7% compared to the same period last year.
As of press time, Miniso's US stock closed at $20.01, up 8.22%; Miniso Hong Kong stock closed at HKD 38.7, up 8.4%.
Overseas revenue increased by 39.8% year-on-year, deepening IP strategy
According to the financial report, Miniso's revenue from mainland China in the third quarter of 2024 increased by 8.7% year-on-year to 2.71 billion yuan, mainly due to a 5.7% increase in revenue from Miniso brands in mainland China; And due to a 50.4% increase in revenue from TOP TOY.
Miniso's revenue from overseas markets in the third quarter of 2024 was 1.81 billion yuan (approximately 258 million US dollars), a year-on-year increase of 39.8%, mainly due to a 55.4% growth in revenue from overseas direct markets on a comparable basis; The revenue from the overseas agency market increased by 26.5% on a comparable basis.
In terms of store expansion, as of September 30, 2024, Miniso has entered a total of 112 countries and regions worldwide, with 4250 domestic stores and a net increase of 324 stores in the first three quarters, maintaining a steady pace of opening stores and moving towards the goal of a net increase of 350-450 stores for the whole year; There are 2936 overseas stores, with a net increase of 449 in the first three quarters. It is expected that the net increase for the whole year will reach 650-700.
In addition, Miniso continues to deepen its IP strategy. As of now, Miniso has collaborated with over 150 well-known IP images worldwide. There are 6 out of the top 10 global IP licensees and 9 out of the top 20 IP licensees, all of which have established partnerships with Miniso.
Ye Guofu, founder, chairman and CEO of Miniso Group, stated that the IP consumer goods market is a trillion dollar market, and Miniso's IP strategy has great potential. In the future, Miniso will deeply bind with global top IP licensees, utilizing its global store network, global design capabilities, and global supply chain integration capabilities to launch more "good-looking, fun, and user-friendly" products.
Under the continuous guidance of this strategy, TOP TOY under Miniso has also entered a high-speed development track. According to financial report data, TOP TOY's revenue in the third quarter reached 270 million yuan, a year-on-year increase of over 50%, and has been profitable for four consecutive quarters. In terms of store expansion, as of September 30th, TOP TOY has 234 stores, including 29 direct operated stores and 205 partner stores, with a net increase of 86 stores in the first three quarters of 2024.
At the same time, TOP TOY is also accelerating its overseas expansion. In August of this year, TOP TOY made its debut in the flagship store of Miniso in Jakarta Central Park, Indonesia, in the form of a store within a store. In October of this year, TOP TOY opened its first overseas store in Bangkok, Thailand. TOP TOY has revealed to the public that it will further expand its overseas market territory in the future.
It is worth noting that in response to the potential risk of US tariffs, Ye Guofu stated at last night's earnings conference that Miniso is actively taking various measures, including increasing the proportion of local assets and seeking alternative supply chains in Southeast Asia, Japan, and South Korea, to ensure the stability of the supply chain.
More than 60% of the acquisition of Yonghui's investment amount is planned to be resolved through external borrowing
On September 24th, Miniso and Yonghui Supermarket both announced that Miniso's wholly-owned subsidiary plans to acquire 29.4% of Yonghui Supermarket's equity for 6.27 billion yuan. After the transaction is completed, Miniso will become Yonghui Supermarket's largest shareholder.
At this performance meeting, Miniso disclosed the progress of its acquisition.
The acquisition of Yonghui project is steadily progressing, and the overall project progress is in line with expectations. It is expected that the transaction will be completed in the first half of 2025, "said Zhang Jingjing, Chief Financial Officer of Miniso, at last night's performance meeting. Currently, two of the five prerequisites have been met: the transaction circular has been confirmed by the Hong Kong Stock Exchange without objection, and the public notice period for simple cases of concentration of operators has ended.
According to Zhang Jingjing, Miniso is expected to secure no less than 60% of its investment amount, approximately 3.76 billion yuan, through external borrowing to support this acquisition. According to the financial report, in the first nine months of this year, Miniso generated a net cash flow of 2.03 billion yuan from operating activities and a free cash flow of 1.47 billion yuan. As of September 30, 2024, Miniso holds 6.28 billion yuan in cash.
Since the acquisition of Yonghui shares, investors have been concerned about Miniso's future strategy for Yonghui.
Ye Guofu revealed at the financial report and performance meeting that Miniso has proposed four strategies for Yonghui: first, joint procurement, and the teams of both sides have started to connect; Secondly, assist in building our own brand, increase the proportion of our own products, and improve our gross profit margin; The third is to optimize store products and services, improve operational efficiency, achieve cost reduction and efficiency improvement by controlling operating expenses, enhance personnel efficiency, and ensure profitability of pop-up stores; The fourth is to focus on resources, prioritize adjusting and closing loss making stores, adhere to high-quality development, focus on high-quality resources to open good stores, ensure profitability of the adjusted stores, and even if the number of stores decreases, achieve overall performance improvement by improving individual store performance.
Millet products will be the key development direction next year
Recently, Miniso and Meituan announced a deep strategic cooperation, with a focus on instant retail business and accelerating the layout of lightning warehouses.
It is reported that since the opening of its first store in January this year, Miniso has opened about 500 24-hour super stores, with cumulative sales exceeding 100 million yuan. Miniso will launch over 800 "24-hour super stores" in the form of lightning warehouses on Meituan within this year, serving consumers' immediate needs for "online ordering and fastest delivery in 30 minutes".
Meituan Warehouse Store is rapidly developing and is a strategic layout of Miniso in instant retail, "Ye Guofu said at last night's financial report and performance conference. The current profitability and investment return trend of the warehouse store confirm previous judgments, and more information will be disclosed to the public when the data model is more stable.
Turning to the current hot millet economy, Zhang Jingjing revealed at the performance meeting last night that the number of stores in the famous and innovative products in the third quarter of 2024 increased by 300 compared with that in the second quarter of the anime zone, and the sales performance of the anime category increased by 50% month on month.
"We have noticed the strong rise of the anime culture, so we plan to take this category as an important development direction next year." Zhang Jingjing said in the financial report that it is expected that next year, we will launch millet peripheral products developed by famous entrepreneurs every month, and create differentiated creative products through second innovation and other ways.