MINISO Announces HKD2 Billion Share Repurchase Program

Rhea-AI Summary

MINISO Group Holding (NYSE: MNSO; HKEX: 9896) has announced a HKD2 billion share repurchase program approved by its board of directors on August 30, 2024. The program will run for 12 months and allows the company to repurchase outstanding ordinary shares and/or American depositary shares. MINISO plans to fund the repurchases from surplus cash, expressing confidence in its business outlook and believing its current share price is below intrinsic value. The repurchases aim to promote shareholder interests and balance growth with stable returns. Purchases may be made on the open market, through private transactions, or other legal means, subject to market conditions and regulations. The program will be conducted under shareholder-approved mandates, with careful consideration to avoid triggering mandatory offer obligations.

Positive

• HKD2 billion allocated for share repurchase program
• Company expresses confidence in business outlook and prospects
• Repurchase funded from surplus cash, indicating strong liquidity
• Aims to promote shareholder interests and provide stable returns
• Potential to increase earnings per share and shareholder value

Negative

• Share price perceived to be below intrinsic value
• Repurchase program to 10% of total issued shares
• Potential impact on working capital, though deemed not material

Financial Analyst

MINISO's HKD2 billion share repurchase program signals strong confidence in the company's intrinsic value and future prospects. This move is likely to be positively received by investors for several reasons:

• It demonstrates management's belief that the stock is undervalued, potentially leading to increased investor interest.
• The buyback could boost earnings per share by reducing the number of outstanding shares.
• It provides a floor for the stock price, potentially reducing volatility.

However, investors should note that the effectiveness of this program depends on market conditions and execution. The 12-month timeframe allows flexibility, but also means the impact may be gradual rather than immediate. Overall, this move aligns shareholder interests with company growth, potentially enhancing long-term value creation.

Corporate Governance Expert

MINISO's share repurchase program demonstrates strong corporate governance practices. Key points to consider:

• The program is structured within regulatory limits, adhering to the 10% cap on issued shares and complying with Hong Kong listing rules.
• There's a clear commitment to shareholder value, balancing growth with returns to investors.
• The company shows transparency in its approach, detailing the program's timeline, funding source and execution methods.

Importantly, MINISO is taking steps to avoid triggering a mandatory offer under takeover rules, showing prudent management of potential unintended consequences. This well-structured approach should enhance investor confidence in the company's governance and strategic decision-making.

Market Strategist

MINISO's share repurchase program is a strategic move that could have significant market implications:

• It may create a positive sentiment loop, attracting more investors and potentially driving up the stock price.
• The program could increase liquidity by providing a consistent buyer in the market.
• It signals management's bullish outlook, which might influence analyst recommendations and valuations.

However, investors should be aware that the actual impact depends on execution. The flexible nature of the program means purchases may not be evenly distributed, potentially leading to periods of higher volatility. Additionally, while the program aims to support the stock price, external market factors could still influence performance. Overall, this move positions MINISO as an attractive value proposition in the retail sector.

 GUANGZHOU, China, Aug. 30, 2024 /PRNewswire/ -- MINISO Group Holding Limited (NYSE: MNSO; HKEX: 9896) ("MINISO", "MINISO Group" or the "Company", together with its subsidiaries, the "Group"), a global value retailer offering a variety of trendy lifestyle products featuring IP design, today announced that, the board of directors of the Company (the "Board") authorized and approved a new share repurchase program on August 30, 2024 (the "2024 Share Repurchase Program"), under which the Company may repurchase up to HKD2 billion in value of its outstanding ordinary shares and/or American depositary shares representing its ordinary shares (collectively, the "Shares") over a period of 12 months starting from the approval date. The Company expects to fund the repurchases under the 2024 Share Repurchase Program from surplus cash on its balance sheet.

The Board has full confidence in the Company's business outlook and prospects, and believes that the current share price of the Company has been below its intrinsic value. By implementing the 2024 Share Repurchase Program, the Company aims to promote the interests of its shareholders ("Shareholders"), balance the Group's fast growth and its commitment to bringing stable and foreseeable return to Shareholders.

The Company's proposed repurchases under the 2024 Share Repurchase Program may be made from time to time on the open market at prevailing market prices, in privately negotiated transactions, in block trades, and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations.

The Company shall conduct the repurchases by exercising its powers under the repurchase mandate granted or to be granted to the Board pursuant to the resolutions of the Shareholders passed at the annual general meeting of the Company each year to repurchase the Shares not exceeding 10% of the total number of the issued Shares (excluding any treasury Shares) as at the date of such annual general meeting (the "Share Repurchase Mandate"), with each mandate to expire upon whichever is the earliest of: (a) the conclusion of the next annual general meeting of the Company; (b) the expiration of the period within which the next annual general meeting of the Company is required by the memorandum and articles of the association of the Company or by any applicable laws to be held; and (c) the date on which the authority given under the ordinary resolution approving the Share Repurchase Mandate is revoked or varied by an ordinary resolution of the Shareholders.

During the period from August 30, 2024 to the date of holding the upcoming annual general meeting of the Company in 2025, the Company will conduct the repurchases under the Share Repurchase Mandate granted by the Shareholders on June 20, 2024, and for the remaining period under the 2024 Share Repurchase Program, the Company will conduct the repurchases under the Share Repurchase Mandate to be granted by the Shareholders at the upcoming annual general meeting of the Company, subject to the approval of the Shareholders and the general mandate conditions as specified above. It is the intention of the Board to implement the 2024 Share Repurchase Program during the 12-month period only in such a way and only to such an extent that would not cause a mandatory general offer obligation to arise under Rule 26 of the Codes on Takeovers and Mergers and Share Buy-backs.

The Company will conduct the share repurchase in compliance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules"). Pursuant to Rule 10.06(2)(e) of the Listing Rules, an issuer shall not purchase its shares on The Stock Exchange of Hong Kong Limited (the "Stock Exchange") at any time after inside information has come to its knowledge until the information is made publicly available. In particular, during the period of one month immediately preceding the earlier of (i) the date of the board meeting for the approval of the issuer's results for any year, half-year, quarterly or any other interim period; and (ii) the deadline for the issuer to announce its results for any year or half-year under the Listing Rules, or quarterly or any other interim period, and ending on the date of the results announcement, the issuer shall not purchase its shares on the Stock Exchange, unless the circumstances are exceptional.

The Company will conduct the proposed share repurchases in compliance with the memorandum and articles of association of the Company, the Listing Rules, the Codes on Takeovers and Mergers and Share Buy-backs, the Companies Law of the Cayman Islands and all applicable laws and regulations to which the Company is subject to.

The Company may cancel such repurchased Shares or hold them as treasury Shares, subject to market conditions and the Group's capital management needs at the relevant time of the repurchases.

The Board believes that the current financial resources of the Company would enable it to implement the share repurchases without causing any material impact on its working capital.

The Board will review the 2024 Share Repurchase Program periodically, and may authorize adjustment of its terms and size.

Shareholders and potential investors should note that any repurchase may be done subject to market conditions and at the Board's absolute discretion. There is no assurance of the timing, quantity or price of any repurchase. Shareholders and potential investors should therefore exercise caution when dealing in the Shares.

About MINISO Group

MINISO Group is a global value retailer offering a variety of trendy lifestyle products featuring IP design. The Company serves consumers primarily through its large network of MINISO stores, and promotes a relaxing, treasure-hunting and engaging shopping experience full of delightful surprises that appeals to all demographics. Aesthetically pleasing design, quality and affordability are at the core of every product in MINISO's wide product portfolio, and the Company continually and frequently rolls out products with these qualities. Since the opening of its first store in China in 2013, the Company has built its flagship brand "MINISO" as a globally recognized retail brand and established a massive store network worldwide. For more information, please visit  https://ir.miniso.com/.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by words or phrases such as "may", "will", "expect", "anticipate", "aim", "estimate", "intend", "plan", "believe", "is/are likely to", "potential", "continue" or other similar expressions. MINISO may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC") and The Stock Exchange of Hong Kong Limited (the "HKEX"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about MINISO's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: MINISO's mission, goals and strategies; future business development, financial conditions and results of operations; the expected growth of the retail market and the market of branded variety retail of lifestyle products in China and globally; expectations regarding demand for and market acceptance of MINISO's products; expectations regarding MINISO's relationships with consumers, suppliers, MINISO Retail Partners, local distributors, and other business partners; competition in the industry; proposed use of proceeds; and relevant government policies and regulations relating to MINISO's business and the industry. Further information regarding these and other risks is included in MINISO's filings with the SEC and the HKEX. All information provided in this press release and in the attachments is as of the date of this press release, and MINISO undertakes no obligation to update any forward-looking statement, except as required under applicable law.

Investor Relations Contact:

Raine Hu
MINISO Group Holding Limited
Email: ir@miniso.com
Phone: +86 (20) 36228788 Ext.8039

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SOURCE MINISO Group Holding Limited

FAQ

What is the value of MINISO's new share repurchase program announced on August 30, 2024?

MINISO announced a HKD2 billion share repurchase program on August 30, 2024.

How long will MINISO's 2024 Share Repurchase Program last?

The 2024 Share Repurchase Program will run for a period of 12 months starting from the approval date of August 30, 2024.

What types of shares can MINISO repurchase under the new program?

MINISO can repurchase outstanding ordinary shares and/or American depositary shares representing its ordinary shares under the program.

How does MINISO plan to fund the 2024 Share Repurchase Program?

MINISO expects to fund the repurchases under the 2024 Share Repurchase Program from surplus cash on its balance sheet.

What is the main purpose of MINISO's share repurchase program?

The program aims to promote shareholder interests, balance growth with stable returns, and address the perceived undervaluation of MINISO's stock.