24Q1 performance: Revenue hit a record high in the first quarter, gross margin reached a record high of 24Q1, with revenue of 3.72 billion yuan, a year-on-year increase of 26%, a record high of first-quarter revenue; gross margin reached 43.4%, a year-on-year increase of 4.1 pct, a record high; adjusted profit recorded 620 million yuan, +28% year-on-year, and adjusted net margin reached 16.6%, +0.2pct year-on-year.
The increase in the share of overseas direct sales revenue contributed to overall gross margin growth, and TOP TOY's revenue this quarter reached a record high
The gross margin of the 24Q1 company reached 43.4%, a record high. The main reason for this is due to structural optimization in overseas markets. The share of revenue in the overseas direct market, which itself has a high gross margin, continues to expand, leading to an increase in overall gross margin. In the quarter, the company's overseas market revenue was 1.22 billion yuan, +53% year-on-year, accounting for 32.8% of overall revenue, up 5.7pct year on year, and same-store sales increased about 21% year on year. Among them, overseas direct market revenue accounted for 58%, up 12pct year on year. Direct market revenue increased 92% year on year this quarter, achieving four consecutive quarters of growth of more than 80%;
On the domestic market side, based on a high base for the same period last year, revenue growth continued to be impressive this quarter. Revenue from mainland China increased 16.2% year on year to 2.5 billion yuan. Among them, MINISO's offline store revenue in mainland China increased 15.6% year on year, average number of stores increased 18.7% year on year, and same-store sales were about 98% of the high base for the same period last year.
TopToy's revenue reached a record high. This quarter's revenue reached 210 million yuan, up 55% year on year. The average number of stores increased by 32.2%, and same-store sales increased by about 26% year over year. By the end of the quarter, the total number of TOP TOY stores had reached 160, a net increase of 12 in the single quarter, an increase of 44 over the previous year, including 17 directly-managed stores and 143 partner stores.
Single store revenue increased significantly, continuing the rapid pace of store expansion
In terms of store expansion, MINISO insists on implementing globalization and maintaining a rapid pace of store expansion. By the end of the first quarter, MINISO had 6,630 stores, a net increase of 217 in a single quarter, an increase of nearly three times compared to the net increase in the same period last year. There were 4,034 stores in China, a net increase of 108 in a single quarter, a net increase of 651; there were 2,596 overseas stores, a net increase of 109 in the single quarter, and a net increase of 465 year-on-year, including 281 direct-run stores, a net increase of 43 in a single quarter, and 2,315 agency stores, a net increase of 66 in a single quarter.
Investment advice
With the structural optimization of overseas markets, the direct management market is expected to drive a further increase in the company's profits. We expect the company's revenue for the 2024/2025/2026 natural year to be 174/210/24.3 billion yuan, achieving net profit of 28.0/33.21/38.24 billion yuan, and an adjusted net profit of 29.03/34.39/39.59 billion yuan, maintaining a “buy” rating.
Risk warning
Macroeconomic risks; overseas business expansion falls short of expectations; product development falls short of expectations.