Summary of Miniso Conference Call Company Overview - **Company**: Miniso - **Ticker**: 9896 HK (H shares), MNSO US (ADR) - **Market Capitalization**: Approximately $5.9 billion USD / $5.7 billion HKD Key Industry Insights - **China SSSG Recovery**: Expected to recover from a high single-digit decline in 2024 to a mid-single-digit growth in 2025, driven by improved consumer sentiment and strategic initiatives [1][5] - **Overseas Expansion**: Significant growth anticipated with 50-70% of new store openings planned for international markets, contributing to a projected 1.1 percentage point uplift in operating profit margin [1][5] - **Yonghui Acquisition**: Miniso's acquisition of a 29.4% stake in Yonghui is expected to lead to a clearer turnaround strategy, with a target to significantly reduce losses in 2025 [1][5] Financial Performance - **2024 Revenue Growth**: Revenue and adjusted earnings increased by 22.8% and 15.4% year-over-year, respectively, aligning with expectations [1][5] - **2025 Forecasts**: Revenue and earnings are projected to grow at compound annual growth rates (CAGRs) of 18% and 24% from 2025 to 2027 [1][5] - **Price Target Adjustments**: New price targets set at $22 for ADR and HK$43 for H shares, based on a 15x 2025E P/E ratio [1][5] Strategic Initiatives - **Store Expansion Plans**: Miniso plans to open 500-600 new stores overseas in 2025, including 200-300 direct-to-consumer (DTC) stores, with a focus on the US market [5][10] - **IP Strategy**: Aiming for 90 new intellectual property (IP) projects in 2025 to enhance consumer engagement and drive same-store sales growth [5][9] - **Membership Growth**: Plans to expand the membership system, as members reportedly spend 2.2 times more than non-members [5][9] Operational Insights - **DTC Store Margins**: Current DTC stores have the lowest margins, but improvements are expected as the store count increases and operational efficiencies are realized [5][9] - **Cost Management**: Strategies to manage costs include sourcing 30% of products from outside China and adjusting pricing to maintain stable gross margins amid tariff pressures [12][13] Earnings Estimates - **2025 Revenue and Profit Projections**: Group revenue is expected to grow by 25.8% in 2025, with adjusted operating profits anticipated to accelerate compared to 2024 [15][21] - **Adjusted Net Profit Growth**: Forecasted adjusted net profits for 2025 are projected to grow by 21.2% year-over-year [21][15] Risks and Considerations - **Market Concerns**: Ongoing concerns regarding SSSG performance and margin erosion due to investments in overseas DTC stores [6][19] - **Tariff Risks**: Miniso is actively working to mitigate risks associated with US tariffs through supply chain diversification and pricing strategies [12][13] Conclusion Miniso is positioned for recovery and growth in 2025, with strategic initiatives in place to enhance its market presence both domestically and internationally. The focus on IP development, store expansion, and cost management will be critical in navigating the challenges ahead while capitalizing on emerging opportunities in the retail sector.

Investment Rating - The report maintains a "Buy" rating for MINISO [4][6] Core Views - MINISO achieved a revenue of 16.994 billion yuan in 2024, representing a year-on-year growth of 22.8%, with an adjusted net profit of 2.721 billion yuan, up 15.4% year-on-year [1] - The company plans to pay a cash dividend of 101 million USD, which is approximately 50% of the adjusted net profit for the six months ending December 31, 2024 [1] - The domestic store expansion is steady, with a net increase of 136 stores in Q4 2024, bringing the total to 4,386 stores, an increase of 460 stores year-on-year [1] - The overseas market continues to grow primarily through direct stores, with a total of 3,118 overseas stores by Q4 2024, an increase of 631 stores year-on-year [2] Summary by Sections Domestic Performance - In Q4 2024, domestic MINISO achieved a revenue of 2.297 billion yuan, a year-on-year increase of 6.5% [1] - Same-store sales faced pressure, with a year-on-year decline of 4.62% in Q4 [1] Overseas Performance - Overseas revenue reached 2.132 billion yuan in Q4 2024, a year-on-year increase of 42.7% [2] - Direct store and partner store growth rates were 65.5% and 17.4%, respectively [2] Profitability and Costs - The gross margin reached a historical high of 47% in Q4 2024, up 3.9 percentage points year-on-year [3] - Selling, administrative, and financial expense ratios increased to 21.24%, 5.87%, and 0.34%, respectively, due to accelerated direct store expansion [3] Financial Projections - Revenue projections for 2025-2027 are 20.905 billion, 24.628 billion, and 28.244 billion yuan, respectively, with corresponding net profits of 3.057 billion, 3.747 billion, and 4.411 billion yuan [4][5] - The estimated P/E ratios for 2025-2027 are 13.8, 11.3, and 9.6 times, respectively [4][5]

Investment Rating - The report maintains a "Buy" rating for MINISO, reflecting confidence in its growth potential and market position [4][6]. Core Insights - MINISO achieved a revenue of 16.994 billion yuan in 2024, representing a year-on-year growth of 22.8%, with an adjusted net profit of 2.721 billion yuan, up 15.4% year-on-year [1]. - The company plans to pay a cash dividend of 101 million USD, which is approximately 50% of the adjusted net profit for the six months ending December 31, 2024 [1]. - Domestic store expansion continues, with a net increase of 136 stores in Q4 2024, bringing the total to 4,386 stores, although same-store sales showed a decline of 4.62% in Q4 [1]. - Internationally, MINISO's overseas revenue grew by 42.7% year-on-year in Q4 2024, driven by a net increase of 182 stores, with a total of 3,118 overseas stores [2]. Summary by Sections Domestic Performance - In Q4 2024, MINISO's domestic revenue reached 2.297 billion yuan, a 6.5% increase year-on-year, supported by steady store expansion and online sales growth [1]. - The company anticipates stable store openings in 2025, with revenue growth expected from both online business and same-store sales [1]. International Performance - The overseas segment saw a significant revenue increase, with Q4 2024 revenue at 2.132 billion yuan, marking a 42.7% year-on-year growth [2]. - The company operates 3,118 overseas stores, with a focus on direct sales, which showed a growth rate of 65.5% [2]. Financial Metrics - The gross margin reached a record high of 47% in Q4 2024, an increase of 3.9 percentage points year-on-year [3]. - The report projects revenues of 20.905 billion yuan, 24.628 billion yuan, and 28.244 billion yuan for 2025, 2026, and 2027 respectively, with corresponding net profits of 3.057 billion yuan, 3.747 billion yuan, and 4.411 billion yuan [4][5].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company is experiencing high growth in overseas direct sales, while domestic same-store performance is expected to improve [1][5] - The overall gross margin reached a historical high of 47.0% in Q4 2024, with a year-on-year increase of 3.9 percentage points and a quarter-on-quarter increase of 2.1 percentage points [5] - The company plans to open over 1,000 new stores in 2024, accelerating its expansion in overseas markets [8] Summary by Relevant Sections Overall Performance in 2024 - The company's total revenue for 2024 is projected to be 169.94 billion yuan, representing a year-on-year growth of 22.8% [8] - Adjusted net profit is expected to be 27.21 billion yuan, with a year-on-year increase of 15.4% [8] Direct Sales Market - The revenue share from direct sales continues to expand, contributing to the improvement in gross margin [5] - The company is focusing on optimizing store selection and expanding store sizes to enhance domestic same-store performance [5] TopToy Growth - TopToy's revenue for 2024 is expected to reach 980 million yuan, with a year-on-year growth of 44.7% [5] - The company plans to expand TopToy's overseas business, with future sales expected to exceed 50% from international markets [5] Financial Projections - Revenue projections for 2025, 2026, and 2027 are 209.8 billion yuan, 254.3 billion yuan, and 303.9 billion yuan, respectively, with year-on-year growth rates of 23%, 21%, and 20% [6] - Adjusted net profit projections for the same years are 31.0 billion yuan, 36.0 billion yuan, and 40.2 billion yuan, with year-on-year growth rates of 14%, 16%, and 12% [6]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company has shown strong growth in overseas direct sales, while domestic same-store performance is expected to improve [5][6] - The overall gross margin reached a new high of 47.0% in Q4 2024, with a year-on-year increase of 3.9 percentage points [5] - The company plans to open over 1,000 new stores in 2024, accelerating its overseas market expansion [8] Summary by Relevant Sections Overall Performance - In 2024, the company's revenue reached 169.94 billion, a year-on-year increase of 22.8%, with an operating profit of 33.16 billion, up 17.6% year-on-year [8] - Adjusted net profit for 2024 was 27.21 billion, reflecting a year-on-year growth of 15.4% [8] Revenue and Profit Forecast - Revenue projections for 2025, 2026, and 2027 are 209.8 billion, 254.3 billion, and 303.9 billion respectively, with year-on-year growth rates of 23%, 21%, and 20% [6] - Adjusted net profit estimates for the same years are 31.0 billion, 36.0 billion, and 40.2 billion, with year-on-year growth rates of 14%, 16%, and 12% [6] Store Expansion and Market Strategy - The company plans to increase its store count to 7,504 by the end of 2024, with 631 new stores opened overseas [8] - TopToy's revenue for 2024 is projected to reach 9.8 billion, a year-on-year increase of 44.7%, with significant growth in overseas markets [5]

Summary of Miniso (MNSO US) Conference Call Company Overview - **Company**: Miniso (MNSO US) - **Industry**: Specialty Retail - **Market Cap**: USD 13,065 million - **Current Share Price**: USD 20.79 - **Target Price**: USD 27.70 (previously USD 29.30) [5][23] Key Financial Results - **2024 Adjusted Net Profit**: RMB 2,721 million, up 15% year-on-year [2] - **2024 Revenue Growth**: 25% year-on-year [2] - **Operating Profit Margin (OPM)**: Decreased by 0.9 percentage points to 19.5% due to margin dilution from accelerated opening of self-operated stores [2] - **Dividend Declared**: USD 0.3268 per ADR, representing a full-year payout of 50% on adjusted net profit [2] Future Guidance - **2025 Expansion Plans**: Slower pace of expansion expected compared to 2024, but revenue growth anticipated to accelerate due to improving same-store sales growth (SSSG) [3] - **2025 Revenue Growth Forecast**: 25% year-on-year [3] - **2025 Net Profit Growth**: Expected to grow by 12% year-on-year, but revised down by 9% due to negative impacts from Yonghui acquisition and higher finance costs [3][22] - **2026 Profitability Outlook**: Anticipated improvement in profitability post-acquisition restructuring of Yonghui [4] Valuation and Target Price Adjustments - **Target Price Reduction**: DCF-based target price cut by 5.5% to USD 27.70 [5][23] - **2025 Operating Profit (OP) Estimates**: Slightly lowered by 1% due to conservative OPM assumptions [3] - **2025/26 Net Profit Estimates**: Reduced by 9% due to higher finance costs and losses from Yonghui [22] Market Position and Risks - **Overseas Market Contribution**: Expected to contribute over 70% of revenue growth from 2024 to 2027 [21] - **Key Risks**: - Continued negative SSSG in China due to deteriorating offline traffic [27] - Potential for lower-than-expected margins from overseas self-operated stores [27] - Rising competition and potential disruptions from pandemics or other events [27] Financial Ratios and Projections - **2024 Revenue**: RMB 16,994 million, with a year-on-year growth of 22.8% [24] - **2025 Revenue Estimate**: RMB 21,252 million, with a year-on-year growth of 25.1% [24] - **2026 Revenue Estimate**: RMB 25,687 million, with a year-on-year growth of 20.9% [24] - **2024-2026 CAGR for Net Profit**: Revised to 17.6% from previous 22.5% [22] Conclusion - **Investment Rating**: Maintain Buy rating despite target price reduction, indicating a potential upside of 33.2% from current share price [5][27] - **Market Sentiment**: The company is positioned to benefit from overseas growth, although domestic challenges remain a concern [4][21]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Insights - The company has deepened its IP strategy and accelerated globalization, achieving a record high gross margin [1] - In 2024, the company achieved revenue of 16.99 billion yuan, a year-on-year increase of 22.8%, with adjusted net profit of 2.72 billion yuan, up 15.4% [5] - The company expects to maintain strong performance in the second half of 2025, driven by its IP strategy and expansion of overseas direct stores [5] Financial Summary - Revenue projections for 2025, 2026, and 2027 are 20.95 billion yuan, 25.51 billion yuan, and 30.97 billion yuan respectively, with year-on-year growth rates of 23.3%, 21.7%, and 21.4% [5] - Net profit projections for the same years are 3.05 billion yuan, 3.72 billion yuan, and 4.57 billion yuan, with year-on-year growth rates of 16.5%, 22.1%, and 22.7% [5] - The gross margin is expected to improve from 44.9% in 2024 to 50.6% in 2027 [5] Market Performance - The company has optimized its store layout and enhanced IP penetration in China, with revenue from the mainland reaching 9.33 billion yuan, a 10.9% increase [5] - The overseas revenue reached 6.68 billion yuan, a 41.9% increase, with a significant increase in the number of direct stores [5] - The company is focusing on enhancing its online sales and expanding its product categories to drive growth [5]

Investment Rating - The report maintains a "Buy" rating for the company [1][10][11] Core Insights - The company achieved a record high gross margin of 47.0% in Q4 2024, driven by its IP strategy and strong performance in the overseas direct sales market [6][7] - Total revenue for 2024 reached 169.9 billion RMB, reflecting a year-on-year increase of 22.8% in Q4 [6][10] - The company expects revenue growth in the second half of 2025 to outpace the first half, despite a slight decrease in the number of new store openings compared to 2024 [6][10] Financial Performance - In Q4 2024, the company reported a net profit of 7.9 billion RMB, a 20.0% increase year-on-year, with an adjusted net profit margin of 16.8% [6][7] - The company’s total number of stores reached 7,504 by the end of 2024, with significant growth in overseas locations [7][10] - The adjusted EBITDA for Q4 was 12.3 billion RMB, showing a year-on-year increase of 23.3% [7] Revenue Breakdown - In Q4 2024, revenue from the Miniso brand was 44.3 billion RMB, up 21.3% year-on-year, with overseas revenue growing by 42.7% [7] - The TOPTOY brand contributed 2.8 billion RMB in revenue, marking a 50.3% increase year-on-year [7] Future Projections - Revenue is projected to grow to 208 billion RMB in 2025, with a year-on-year growth rate of 23% [10][11] - Adjusted net profit is expected to reach 32 billion RMB in 2025, reflecting a 19% increase [10][11] - The company anticipates a gradual increase in gross margin, supported by the rising contribution from overseas and IP sales [7][10]

加码"IP经济"，名创优品引领中国文化出海 名创优品董事会主席兼首席执行官叶国富表示，未来，名创优品的目标是要成为世界第一的 IP 设 计零售集团。全球消费需求朝着兴趣消费、品质消费转变，中国供应链和消费市场优势明显。名创优品 将会抓住机遇，继续在 IP 联名、产品创新、消费体验上发力，在全球零售市场中占据更加重要的地 位。 毛利率攀升，业绩稳健向好 致力于成为"世界第一IP设计零售集团"的名创优品于近期公布2024年财报。在"IP经济"加持下，名 创优品业绩再度让投资者惊喜。 财报数据显示，2024年，名创优品全年总营收达170亿元，同比增长22.8%；海外营收同比增长42% 至66.8亿元。毛利率44.9%，较去年同期上升3.7个百分点，再次创下历史新高。 受到良好业绩的鼓舞，名创优品也大手笔分红，宣布派发2024年末期股息7.4亿元，约占其截至 2024年12月31日止六个月经调整净利润的50%，持续为股东带来丰厚回报。 2024年，名创优品主要盈利指标均录得良好增长，盈利能力也在持续提升。 名创优品2024年经营利润为33.16亿元，较上年同期的28.2亿元增长17.6%；期内利润为26.35亿元， ...

Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The company reported a revenue of 16.994 billion yuan for 2024, representing a year-on-year growth of 22.8%, and an adjusted net profit of 2.72 billion yuan, up 15.4% year-on-year [2] - Domestic same-store sales faced pressure in the second half of the year, leading to a slowdown in revenue growth, while overseas business maintained high growth [3] - The company opened a net total of 1,219 new stores in 2024, implementing a channel upgrade strategy [4] - The gross margin increased for eight consecutive quarters, reaching 44.94%, while the expense ratio rose due to the expansion of direct-operated stores [5] - The company returned 1.5745 billion yuan to shareholders in 2024, including cash dividends and share buybacks, indicating a commitment to enhancing shareholder returns [6] Summary by Sections Financial Performance - The company achieved a total revenue of 16.994 billion yuan in 2024, with a year-on-year growth of 22.8% [2] - The adjusted net profit for 2024 was 2.72 billion yuan, reflecting a 15.4% increase compared to the previous year [2] - Revenue growth was driven by overseas MINISO and TOP TOY, which grew by 41.9% and 44.7% respectively, while domestic MINISO saw a growth of 10.9% [3] Store Expansion - The total number of stores reached 7,504 by the end of 2024, with 4,386 in mainland China and 3,118 overseas [4] - The company added 1,219 new stores in 2024, with significant contributions from both domestic and overseas markets [4] Profitability and Margins - The gross margin improved to 44.94%, up 3.7 percentage points year-on-year, attributed to higher revenue from high-margin IP products and an increase in overseas business [5] - The sales and distribution expense ratio increased to 21%, reflecting a 5 percentage point rise due to the expansion of direct-operated stores [5] Shareholder Returns - The company returned a total of 1.5745 billion yuan to shareholders in 2024, which included cash dividends of 1.2443 billion yuan and share buybacks of 330.2 million yuan [6] - The year-end dividend payout amounted to 740 million yuan, approximately 50% of the adjusted net profit for the second half of 2024 [6] Future Earnings Forecast - The company expects revenues of 21.1 billion yuan, 24.9 billion yuan, and 28.5 billion yuan for 2025, 2026, and 2027 respectively, with year-on-year growth rates of 24%, 18%, and 14% [7] - The forecasted net profit for 2025, 2026, and 2027 is 2.94 billion yuan, 3.72 billion yuan, and 4.50 billion yuan respectively, with corresponding year-on-year growth rates of 12%, 26%, and 21% [7]