Domestic Sports Brand Sales Grew Steadily In The First Quarter

In the past year, sports brands in China have explored the big market in China and occupy a certain share in the market. In the recent quarter, domestic sports brand sales continued to grow steadily.

Discount sales decreased steadily

Ding Shuibo, international president and chief executive officer, said at a recent press conference that sales of functional sporting goods continued to increase in 2016, driving sales and comprehensive average prices to rise. The number of orders for the fourth quarter of 2016 was higher.

In addition, through continuous optimization of product mix, the sales of functional running shoes and clothing products were increased. In the first quarter of this year, the number of units in the same store sales increased, and the same store sales grew well in April. The retail discount rate of the terminal was maintained at 25%, and the retail discount level was similar to that in 2015.

The first quarter operating summary released by 31st degree also showed that the sales of the same brand store increased by 7.2%, and the average retail discount decreased from 30% in the previous quarter to 28%.

The sale of independent business has increased by 7.5%, with 121 new stores and 2471 outlets.

During the period, the group added 230 stores and closed 336 stores, bringing the total number of stores to 7102.

In addition, the core brand orders of the group's 2016 winter order will reach a high digit growth rate, and the order value will keep increasing for nine consecutive quarters.

With the increase of sales volume, the profit margin of products has also been improved through the enhancement of added value of products.

Anta sports public information shows that the group's first quarter sales coincides with the same period last year, while continuing confidence in the second quarter sales performance.

Multiple layout and brand structure optimization

While the original brand maintained steady growth, Quanzhou sports brand also accelerated the pace of diversification.

In April 20th, Anta announced the establishment of a joint venture with Descente, with an investment of 150 million yuan and a holding of 60%.

After the establishment of the joint venture, Anta will enjoy all the products that are exclusively engaged in designing, purchasing, marketing, or having "Descente" brand or affiliated brand in China, and all product businesses that make "Descente" brand inside or outside China.

Anta said that the multi brand strategy is one of the important strategies Anta has taken to fully grasp the Chinese market.

The signing of the joint venture agreement will widen Anta's business in China's high-end sports apparel market, thereby enhancing Anta's profitability and helping Anta to develop its overall business in the future.

It is understood that "Descente" is a famous Japanese sports apparel brand, the flagship skiing supplies.

The industry believes that the Anta joint venture to create ski outdoor brand is a further extension of the product line, and can get higher profits by entering high-end products.

Previously, Anta's brand matrix already had Anta, FILA and Anta children.

Through strategic cooperation with music sports in intelligent sports equipment, we will launch a number of cooperation contents including intelligent motion equipment product design, R & D and production, APP application development, upgrading and maintenance, project promotion and marketing.

After the cooperation between XTEP and Chi Mei, the industry chain extends from the product itself to the operation of the event. He Ruibo, chief financial officer of XTEP, said that apart from CO organizing events, the two sides did not rule out more directions for future cooperation, including cooperative operation shops.

Optimistic about post market institutions to enhance rating

The broad market prospect of sports industry and the excellent performance of the brand in the past two years have also made Quanzhou sports brand become a hot spot for capital pursuit. Last month, Anta sports, 31st degree and PEAK sports in Hong Kong stocks all went up against the trend.

According to Credit Suisse's report, Anta sports business, as expected, will launch a company that distributes "Descente" trademark products in the mainland, plans to open 400 to 500 stores in the next 2 to 3 years, and plans to make profits in 2 to 3 years. In terms of sports shoes business, Anta's sales target is 1 million pairs of shoes this year.

In addition, Anta's first quarter gross profit margin and operating income margin remained stable.

To this end, the bank maintained Anta's "win win" rating and target price of 26 yuan.

XTEP international buy rating is also given.

The investment organization said that XTEP group's net profit in 2015 was in line with market expectations. It was mainly driven by increased sales of professional sports products and gross margin. During the period, gross profit margin rose to 42.2%, higher than the average value of market expectations. In addition, group orders continued to record positive growth. In the future, the sales growth of the group in the same industry is expected to further improve in the case of a reduction in retail discount.