Business context and reporting period
MINISO Group Holding Limited is a global value retailer of lifestyle and pop-toy products, principally under the MINISO and TOP TOY brands. This Form 20-F is an audited transition report for the six months ended December 31, 2023, following the company’s change of fiscal year-end from June 30 to December 31. It is not a standalone 2023 fourth-quarter report; the filing does not provide Q4-only results. Financial statements are prepared under IFRS in RMB.
MINISO primarily sells through retail partners, distributors, directly operated stores and online channels. At December 31, 2023, the company reported more than 3,900 MINISO stores in China, approximately 2,500 MINISO stores overseas and 148 TOP TOY stores in China.
Financial performance and position
Unless noted, amounts below are RMB millions. Six-month comparisons are December 2023 versus December 2022; the comparable six-month figures are identified as unaudited in the filing.
| Metric | Six months ended Dec. 31, 2023 | Change vs. prior comparable period |
|---|---|---|
| Revenue | 7,632.5 | +44.9% |
| Gross profit / gross margin | 3,241.0 / 42.5% | +63.2%; margin up from 37.7% |
| Operating profit | 1,553.7 | +62.3% |
| Profit for the period | 1,256.1 | +64.4% |
| Adjusted net profit, a non-IFRS measure | 1,302.5 | Up from 790.5 |
| Net cash from operating activities | 1,097.5 | Up from 433.3 |
Revenue increased in China by 44.1% to RMB4,843.1 million and overseas by 46.3% to RMB2,789.3 million. Overseas markets represented 36.5% of revenue, versus 36.2% a year earlier. MINISO store count rose to 6,413 from 5,440, and reported revenue per MINISO store increased 26.6% to RMB1.2 million for the six-month period.
Cost of sales rose 33.8% to RMB4,391.4 million. Selling and distribution expenses increased 70.8% to RMB1,363.1 million, reflecting business growth, personnel, logistics, IP licensing, directly operated store depreciation, promotion and advertising. General and administrative expenses rose 13.9% to RMB357.7 million. Income tax expense was RMB396.7 million. Net finance income was RMB98.8 million, mainly due to higher interest income on bank deposits; other net income fell to RMB21.1 million, primarily reflecting foreign-exchange losses.
TOP TOY revenue was RMB368.8 million for the six months, and its segment reported RMB6.5 million profit before tax, compared with a loss in the prior comparable period. MINISO brand revenue was RMB7,251.6 million and segment profit before tax was RMB1,644.8 million.
At December 31, 2023, cash and cash equivalents were RMB6,415.4 million; total assets were RMB14,485.3 million, total equity RMB9,191.2 million and total liabilities RMB5,294.1 million. Net current assets were RMB5,920.7 million. Borrowings were RMB7.3 million; lease liabilities were RMB1,245.3 million. The company reported no unused banking facilities. It stated that cash and expected operating cash flows were sufficient for working capital and capital expenditure needs for at least 12 months from period-end.
Operating cash flow was RMB1,097.5 million. Investing activities provided RMB177.1 million, including proceeds from disposal of investments and release of term deposits, partly offset by investment purchases and capital spending. Financing activities used RMB1,320.9 million, chiefly for dividends of RMB923.7 million, lease payments and share repurchases. Capital expenditures were RMB264.8 million; inventory purchases were RMB4,721.4 million.
Material changes and notable items
- Revenue growth was broad-based across China and overseas markets, supported by store expansion and higher revenue per MINISO store.
- Gross margin improved by 4.8 percentage points. Management attributed this to product optimization and greater directly operated-market contribution overseas, MINISO brand-upgrade products and cost savings in China, and a more profitable TOP TOY product mix.
- Operating and net profit grew more slowly than revenue-related gross profit as selling and distribution expenses increased substantially.
- Cash declined slightly from RMB6,489.2 million at June 30, 2023 to RMB6,415.4 million at December 31, 2023, with dividends and buybacks contributing to financing cash outflow.
- The board approved a change to a calendar-year reporting cycle. The filing cautions that the six-month transition period is not directly comparable with the prior full fiscal years.
Outlook, risks and contingencies
The filing gives no numerical revenue or earnings guidance. Management says it is not aware of trends since January 1, 2024 reasonably likely to materially adversely affect results, liquidity or capital resources, while emphasizing that forward-looking statements are subject to substantial risks and uncertainties. Key business sensitivities include consumer demand and economic conditions, competition, store expansion and sales productivity, overseas execution, supply-chain costs, inventory demand and markdown estimates, and foreign-exchange movements.
MINISO Guangzhou committed to local tax payments of RMB210 million in 2024 and RMB230 million in 2025 under a five-year commitment; failure to meet a year’s target could require compensation for the shortfall. The company said it met the 2023 commitment and recorded no provision at December 31, 2023. A RMB30 million illicit-competition judgment was upheld and paid during the period. A U.S. securities class action motion to dismiss was granted in February 2024 with leave to amend; plaintiffs sought reconsideration and intended to file an amended complaint, and the company said potential losses could not be reliably estimated as of period-end. Two California wage-and-hour cases settled for US$1.25 million, with court approval in February 2024; other wage actions were ongoing and described as immaterial. The company also reported a proposed post-period special dividend of US$90.5 million.
The auditor issued an unmodified opinion. Critical audit matters included inventory write-down estimates and impairment assessments for certain directly operated stores. Management’s non-IFRS adjusted net profit excludes share-based payment expenses; it should not be treated as a substitute for IFRS profit.
Important facts for investors to verify
- Confirm the transition-period basis and avoid treating the six-month figures as Q4 results or comparing them directly with a full-year period.
- Review whether the margin improvement and store-level revenue growth persist as MINISO expands, and track the faster growth in selling and distribution expenses.
- Assess inventory growth to RMB1,922.2 million, working-capital cash use and the assumptions underlying inventory write-downs.
- Monitor overseas distributor receivables, collection quality and the concentration of trade receivables among major debtors.
- Track cash deployment, dividends, repurchases, lease obligations and planned headquarters construction commitments; distinguish borrowings from lease liabilities.
- Follow the securities litigation, remaining labor disputes, future tax-payment commitments and any updates to the proposed dividend.