Aug. 14, 2018

ANTA Sports Delivers Another Set of

Outstanding Interim Results in 2018

Revenue Reaches RMB10.55 billion with Profit Attributable to Equity Shareholders at RMB1.94 billion 

Hong Kong, August 14, 2018 – ANTA Sports Products Limited (“ANTA Sports” or the “Company”, stock code: 2020.HK, and its subsidiaries collectively the “Group”), a leading sportswear company in China, is pleased to announce its unaudited interim results for the six months ended June 30, 2018 (the “period”).

Financial Highlights

Record-breaking Revenue and Earnings

  • 44.1% increase in revenue to RMB10.55 billion
  • 34.0% increase in profit attributable to equity shareholders to RMB1.94 billion
  • 29.4% increase in basic earnings per share to RMB72.44 cents

Solid Profitability

  • Gross profit margin increased by 3.7p.p. to 54.3%
  • Operating profit margin and margin of profit attributable to equity shareholders stood at 25.5% and 18.4% respectively

Strong Retail Sales Performance

  • Retail sales (in terms of the retail value) of ANTA branded products and other branded products (excluding brands newly joined to the Group after 1 April 2017) during the period increased by high teens and 85%-90% year-on-year respectively, which sustained our leading position in the industry

Attractive Dividend Payout

  • Interim dividend of HK50 cents per ordinary share, an increase of 22.0% representing a payout of the profit attributable to equity shareholders of 60.1%

Operational Highlights

ANTA and ANTA KIDS

  • As COC’s official partner, ANTA designed the “Champion Dragon Outfit” for the PyeongChang 2018 Olympic Winter Games, which made a number of appearances during the Olympics, and ultimately boosted awareness of ANTA’s brand further.
  • ANTA continued to team up with its brand endorser and NBA Champion player, Klay Thompson, and launched a series of successful marketing events, such as the “Shock The Game” tour, further bolstering ANTA’s brand awareness and relevant sales.
  • ANTA teamed up with renowned designer RICO LEE and launched the “Technology Sports” series during the Shanghai Fashion Week with tech giant 3M. In addition, to celebrate NASA’s 60th Anniversary, ANTA launched the “Tribute to NASA” theme for its “SEEED Plan” sport shoes series, which were well received by the market.
  • ANTA confirmed its strategic partnership with Zhejiang Greentown Football Club, marking ANTA’s first collaboration with a soccer club and proving its commitment to developing in this area.
  • ANTA provided competition outfits for the participants of the Spartan Race held in Shenzhen, which attracted more than 5,000 participants.
  • ANTA KIDS continues to use “Grow Up with Fun” as its slogan and launched its “Sports Day” event. It also collaborated with Marvel heroes, which was well received by children aged 0 to 14.
  • ANTA KIDS invited Zhang Yuexuan (Tiantian) – son of the famous model Zhang Liang – to be its first endorser.
  • As at June 30, 2018, the total number of ANTA stores (including ANTA KIDS standalone stores) in China stood at 9,650.

FILA, FILA KIDS and FILA FUSION

  • FILA has been positioned as a high-end sports fashion brand which targets high-end consumers aged between 25 and 45.
  • FILA continued its collaboration with Jason Wu, the New York-based Chinese American fashion designer, and Ginny Hilfiger, a renowned American fashion designer, to introduce the brand-new Jason Wu X FILA and FILA Modern Heritage series respectively.
  • FILA launched its trendy sportswear series, FILA FUSION. This series expands FILA’s presence in the fashion sector by tapping into the youth market.
  • FILA KIDS introduced a brand-new Milan Garden Kidswear collection. By integrating the essence of summer with sports and fashion, this collection extensively reflects the brand’s elegant style.
  • As at June 30, 2018, the total number of FILA stores (including FILA KIDS and FILA FUSION standalone stores) in China, Hong Kong, Macao and Singapore reached 1,248.

DESCENTE

  • After two years of development, DESCENTE has quickly established itself as a functional and professional sportswear brand in China.
  • In terms of brand promotion, during the period, we invited Daniel Wu, a famous movie star, director and producer, to become DESCENTE’s first Chinese endorser, embodying DESCENTE’s brand concept of professionalism, innovation and a spirit that dares to challenge.
  • DESCENTE invited famous yoga tutors to lead a series of fitness courses targeted at women, with the theme “Design Your Moves” in Shanghai, Chengdu, Beijing and Nanjing. “Design Your Moves” aimed to promote sports with the utmost safety and comfort of the SPIRITUAL products series
  • As at June 30, 2018, the total number of DESCENTE stores in China reached 85.

SPRANDI

  • SPRANDI is a fashion and lifestyle sportswear brand, mainly focusing on the fashion athletic footwear market in China.
  • By opening more physical stores and e-commerce platforms, SPRANDI continued to grow and penetrate into the emerging middle-class in China.
  • As at June 30, 2018, the total number of SPRANDI stores in China reached 81.

KOLON SPORT

  • Combining outdoor wear with fashion, KOLON SPORT will expand its footprint in the outdoor sportswear market.
  • As at June 30, 2018, the total number of KOLON SPORT stores in China reached 189.

KINGKOW

  • Our acquisition of KINGKOW, a kidswear brand targeting the mid-to high-end market, has not only helped us to reinforce our presence in the kidswear market, but has also strengthened our multi-brand strategy.
  • During the period, we successfully improved KINGKOW’s store efficiency and inventory turnover through optimizing its store network.
  • As at June 30, 2018, the total number of KINGKOW stores in China, Hong Kong, Macao and the United States reached 63.

E-Commerce

  • In addition to the official online flagship store, we have collaborated with various renowned e-commerce platforms, including Tmall, JD and Vipshop, among others, to further boost the performance of our e-commerce business.
  • We have allowed some of our most outstanding offline distributors to sell ANTA products online to maximize the mutual benefits between web-based and brick-and-mortar stores.
  • We optimized our e-store interface, improved product descriptions and presentations, and enhanced our product search and cataloging functions, to attract more online shoppers.

Upholding Our Multi-Brand Strategy, Improving Retail Management Capabilities and Optimizing Efficiency

  • Our “Single-Focus, Multi-Brand and Omni-Channel” operation model has enabled us to position
    our brands across the mass market to high-end market spectrum, with products catering for
    professional sports and popular sports, athleisure to outdoor, as well as kidswear, all of which
    have ensured the Group caters for every consumer’s needs.
  • We will review market trends in a timely manner in response to consumers’ growing appetite for “athleisure” fashion and the stronger demand for “functional”, “differentiated” and “premium” sportswear products. As such, we have conducted strategic adjustments in our R&D, manufacturing and distribution processes.
  • In response to these challenges, we have built a highly efficient supply chain and a new logistic center to enhance our capabilities, which will further reduce lead times and increase responsiveness to consumer needs.

Ding Shizhong, Chairman and CEO of ANTA Sports, commented,

“Since the beginning of 2018, it was clear to us that China has set itself the goal of becoming a sports powerhouse and the sportswear industry is entering a golden era of rapid growth with unprecedented infrastructure development.
Whether or not the brands can seize these opportunities will be the key to the success of each company. For years, the Group always stay innovative and prepared to embrace ourselves for these opportunities and challenges. With innovation in our DNA, we will continue to be agile and adapt to the marketplace as we transform ourselves into a “new retailer”. While delivering our multi-brand strategy, we also leverage new technology to upgrade and improve customer experience of all the brands across the board.”

“Looking ahead, in order to become a true “Great Brand”, ANTA must build up our capacity to innovate to ensure that we can rival international brands. We must be brave and daring when it comes to being creative and innovative, so that we can provide consumers with value-for-money sportswear products of high international standards, thus transforming ANTA brand from ‘the brand you can buy’ to ‘the brand you want to buy’.”

 

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