He Yin's questions to MINISO Group Holding Ltd (MNSO) leadership • Q1 2024
Question
He Yin of JPMorgan Chase & Co. requested a walkthrough of key assumptions for U.S. market profitability and margin drivers, an explanation for China's gross margin improvement despite flat IP mix and pricing, and the reason for the decline in licensing fees during the quarter.
Answer
Executive Eason Zhang explained that while detailed U.S. financials are not disclosed, the 30-40% SSSG was driven by both traffic and average order value, and there is significant room for logistics cost improvement. He attributed China's gross margin increase to product mix optimization, with high-margin categories like blind boxes growing over 100%. Zhang clarified that the Q1 decline in IP license fees was a result of accounting cut-off timing and is not indicative of a long-term trend.