Miniso Group Holding Limited reported interim earnings on August 28 that revealed divergent trends across its operations. The company’s China business achieved its fastest first-half revenue growth in three years at 26.2%, significantly outpacing the country’s broader retail sales growth of 1.3%. This performance suggested market share gains rather than overall market expansion. The growth was anchored by a membership program that reached 130 million people as of June 30, representing 31% year-over-year growth. Member spending accounted for 77% of China sales in the first half, up from 60% a year earlier, providing a more stable revenue foundation.
The company’s expansion into proprietary intellectual property represented another dimension of its China strategy. The YOYO brand, launched just over a year prior, had expanded to 53 countries and generated close to RMB 500 million in revenue during the first half, including collaborations with major entertainment properties. The company achieved its full-year target of RMB 1 billion in proprietary IP sales by the end of July, ahead of schedule. TOP TOY, the company’s collectibles brand, posted revenue growth of 32.7% over the same period. Members acquired through IP products in 2025 showed an 80% higher retention rate compared to non-IP members and made twice as many purchases.
Profitability metrics presented a more constrained picture. Adjusted operating profit declined 6% year-over-year to RMB 1.49 billion in the first half, driven by a shift toward directly operated stores and away from higher-margin distributor arrangements. Selling expenses increased to 25.8% of revenue from 23.1% a year earlier, primarily due to elevated rent and depreciation costs associated with company-operated locations. Adjusted net profit slipped 1.7% to RMB 1.22 billion despite double-digit top-line growth.
International operations presented significant headwinds. Profit contribution from overseas markets compressed from a 35-40% range in 2023 to just 10-15% in the first half of 2026. Distributor revenue across Asia and Latin America declined 10%, missing company guidance. North America, the largest directly operated overseas market, grew revenue 37% to RMB 1.8 billion, but same-store sales growth decelerated to mid-single-digit levels in the second quarter following product stock shortages and delayed IP launches. Overseas inventory turnover extended to 273 days from 240 days a year earlier. Management now projected full-year adjusted operating profit would decline by a high single-digit percentage as it worked through accumulated inventory.
Institutional positioning reflected mixed sentiment. The number of hedge funds holding the stock increased from 12 to 14 in the most recent quarter, suggesting continued institutional interest. Short interest remained minimal at 2.45% of the float. The stock traded at a forward price-to-earnings ratio of 7.55 on August 28. The company faced the challenge of sustaining rapid China growth while resolving profitability and inventory challenges in its international operations.
Article Attribution | Read More at Article Source
Article summary produced by Claude AI