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Local Sports Brand Performance Report &Nbsp; PEAK Sports Net Profit Decline

2012/3/15 14:28:00 57

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PEAK Sports

(01968, HK) recently released 2011 results show that the company's turnover in 2011 increased year by year, but net profit fell 5.4% year-on-year.

Anta (02020, HK) and Lining (02331, HK) previously issued related announcements also showed that in the net profit growth also appeared to a certain degree of decline.

"For PEAK, 2012 is a year of adjustment."

Liu Xiang, director of public relations in PEAK, said in an interview with reporters that in fact, last year PEAK had begun to make relevant adjustments, including channels, ordering policies, opening up strategies and marketing strategies.

For the difficulties encountered by local sports brands, a number of people interviewed by reporters have expressed pessimistic expectations. The reason is that in the case of rising costs of raw materials, store rentals and manpower, the profitability of local brand shops has not been improved in a timely manner, thereby weakening the overall profit.

Local sports brand performance worries

A few days ago, PEAK sports released its 2011 performance data in Hong Kong. In 2011, the turnover of PEAK was 4 billion 650 million yuan, an increase of 9.4% compared with 2010, and net profit of 780 million yuan, down 5.4% compared with 2010.

Peak

In its annual report, the main reason for the increase in turnover during the year is the increased demand for products of the group and the continuous expansion of China's distribution network.

Data show that as of the end of last year, the number of PEAK distributors increased from 45 at the end of 2010 to 50, and the number of retail outlets increased from 7224 at the end of 2010 to 7806, with a net increase of 582.

In terms of profitability, PEAK's net profit margin dropped from 19.4% in 2010 to 16.7% in 2011.

PEAK said the decline in net profit margins was mainly due to the increase in advertising, promotion and R & D costs.

In terms of profitability, many sports brands previously published in the annual reports are not ideal.

Anta's annual report released in 2011 showed that the company achieved net profit of 1 billion 730 million yuan last year, an increase of 11.5% over the same period last year, but the net profit growth rate dropped by more than 10 percentage points over that of 2010 (24%). Meanwhile, Anta's turnover increased by 20.2%, while its growth rate dropped by nearly 6 percentage points compared with 2010.

Lining released the 2011 performance bulletin, also known as the slow growth of orders and the recovery of some dealers inventory impact, group income in 2011 is expected to decline 6%~7% compared with 2010, and net profit will also be lower than 2010 11.7% 7~8 percentage points.

Slow pace of channel expansion

Throughout the 2011, the sports brand industry is full of bad news, including Lining's closing shop trouble, and the growth of individual brand orders.

There were people in the industry.

China's local sports brand

Growth in the past few years is known as "barbaric growth". During this period, the increase in the number of stores has almost become a "magic weapon" for many manufacturers to increase sales or profits. But looking at the data of the 3 brands in 2011, it is easy to see that the growth of stores has begun to slow down, and the tribute to performance has begun to fail.

Data show that in 2011, the number of PEAK stores increased by 582, but in fact, the company had increased by 590 in the first half of last year, which means that PEAK had begun to reduce the scale of stores in the second half of last year.

The same is true for Anta. Although it has announced that it will enter the era of "Wan Dian" once in a high profile, it actually lowered the target of 8200 stores in October to 7800 to 8000 as early as last year.