On May 15th, Miniso (9896.HK) released its first quarter financial report for 2024. The company achieved a quarterly revenue of 3.72 billion yuan, a year-on-year increase of 26%, setting a new high for quarterly revenue; and achieved an adjusted net profit of 620 million yuan, a year-on-year increase of 28%.
In terms of market breakdown, the mainland China market contributed revenue of 2.5 billion yuan, a year-on-year increase of 16%; while the overseas market contributed 1.22 billion yuan, a year-on-year increase of 53%, accounting for 32.8% of total revenue.
Due to the higher gross profit margin of direct sales channels in the overseas market, the proportion of revenue increased significantly by 12 percentage points to 58% year-on-year, driving Miniso's overall gross profit margin to increase by 4.1 percentage points to 43.4%, reaching a historical high.
As of the end of the first quarter of 2024, Miniso's store count in mainland China increased by a net of 108 stores to 4,034, while the overseas market increased by a net of 109 stores to 2,596.
Miniso CEO Ye Guofu stated at the performance briefing after the financial report release that it is expected to open a net of 900-1,100 stores in 2024, with 550-650 new stores opening overseas, mainly in Asia and Latin America excluding China.
In addition to the sales growth driven by overseas store expansion, Miniso's IP co-branded products drove a 9% year-on-year growth in same-store revenue.
A typical case is the theme pop-up store opened by Miniso and Chiikawa at Joy City in Jing'an, Shanghai, which generated sales of 2.68 million yuan in the first 10 hours of opening and exceeded 8 million yuan in performance in three days.
At the performance briefing, Ye Guofu described this cooperation as consolidating Miniso's &#34;undisputed IP co-branded leader position&#34; and summarized this cooperation with five &#34;unprecedented&#34; aspects: unprecedented business, speed, efficiency, popularity, and unprecedented enthusiasm from Chiikawa fans.
When asked by analysts about the follow-up plans for Chiikawa pop-up stores, Ye Guofu stated that they will continue to open pop-up stores in cities with a large young population such as Wuhan, Chengdu, and Changsha.
In the first quarter of 2024, sales of Miniso's IP products accounted for 26% of total sales, with a higher proportion in the overseas market at 40%.
From 2021 to 2023, as the proportion of IP products gradually increased, Miniso's gross profit margin increased from around 25% to close to 40%.
According to Miniso's plan, IP products are expected to account for 50% of total revenue by 2028.
At the performance briefing, Ye Guofu announced that the tipping point for TOPTOY, a trendy toy brand under Miniso, has arrived, and the target for store openings for TOPTOY within the year has been raised from 50 to 100.
In the first quarter, TOPTOY's revenue increased by 55.1% year-on-year to 214 million yuan, with a net increase of 12 stores to 116.
TradeWind01 received information from the person in charge of TOPTOY that the next direction for TOPTOY's store openings will be in first-tier cities
Different from the fully-operated store model of Pop Mart (9992.HK), TOPTOY mainly adopts a franchise model for its stores, with 143 franchise stores as of the end of the first quarter.
Ye Guofu stated that the reason for the turning point in TOPTOY's performance is that compared to three years ago, when the small players in the trendy toy industry were cleared out, the competitive landscape has improved, and TOPTOY has achieved profitability for two consecutive quarters.
When analysts mentioned the single-store model of TOPTOY franchise stores, the management of MINISO stated that the average sales per store of TOPTOY is 2.5 times that of MINISO, and the profit-sharing ratio is consistent with that of MINISO's stores, both at 40%.
Backed by MINISO, TOPTOY has the advantage of being able to reuse MINISO's cooperative IP.
Taking the example of the Japanese anime IP &#34;Kuromi,&#34; while MINISO borrowed the IP for designing and producing bedside lamps, it also reused it in TOPTOY's blind box products.
According to information from sources close to MINISO, currently, TOPTOY's own brands account for close to 20%, with a mid-term goal of reaching 50%. Own-brand products are mainly focused on building blocks and co-branded products with IPs such as Disney and Sanrio.
Following in the footsteps of MINISO's overseas expansion, TOPTOY is also planning to go global.
When asked by sources close to MINISO about TOPTOY's plans for international expansion, the response was affirmative, but no further details were provided.
This is a path that has already been verified by the leading trendy toy company, Pop Mart.
Unlike home appliances and other Chinese manufacturing industries going global, trendy toys belong to cultural products. Pop Mart, relying on its own IP products accounting for nearly 80%, continuously experimented and finally embarked on a fast growth track last year.
In 2023, Pop Mart achieved revenue of 1.066 billion yuan in the Hong Kong, Macau, Taiwan, and overseas markets, a significant year-on-year increase of 134.9%, with revenue share increasing by 7.1 percentage points to 16.9%.
Earlier, Pop Mart's CEO Wang Ning even called for &#34;rebuilding&#34; another Pop Mart by 2024, with revenue exceeding 1.8 billion yuan.
For TOPTOY, backed by MINISO, the challenge lies not in the retail channels but in the limited number of own IPs available for experimentation compared to Pop Mart. The revenue share of own IPs is currently around 20%, while the latter is close to 80%

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Miniso, which achieved a record high gross profit margin, has mastered the art of co-branding with IPs?