What Is The Status Of Sports Brand XTEP?

Because of wearing

Brand sports shoes are blind, and the young man is refused by the blind person on the grounds that they are not "refined".

Although there are

The official claimed that the rejected guy was his senior engineer, but the value behind it was sought.

Although in recent years, through continuous research and development to improve the quality of products has won the programmers' "love", but the domestic sports brand XTEP International (01368.HK), has not been able to effectively reverse the impression in the minds of consumers.

But the episode does not seem to affect XTEP International's performance in Hongkong's capital market.

Since the 2017 annual report, XTEP's international share price has risen slightly despite the decline in both revenue and net profits.

Executives' buy back and 10th anniversary special dividend schemes have become favorable factors for the rise in stock prices, and the gross margin has increased by 0.7 percentage points to 43.9%, making it a rare bright spot in the annual report.

The company explained in its annual report that the increase in gross profit margin stems from streamlining the department effectively.

The increase of contributions.

However, as one of the four mainland sports brands listed in Hongkong, although the gross margin of XTEP is two percentage points higher than that of 01361.HK (360%), compared with the gross margin of 47.06% and 49.37% of Lining (02331.HK) and Anta sports (02020.HK), there is still a gap between the three.

Hard performance indicators are also not persuasive.

According to XTEP International's latest 2017 annual report, the company achieved operating income of 5 billion 113 million yuan, down 5.2% compared to the same period last year, and net profit was 408 million yuan, down 22.68% compared with the same period last year.

For the first time, revenue and net profit were exceeded by 360%, although the market value of XTEP international 9 billion 685 million yuan was nearly two times that of the former.

According to the world clothing and shoe net, XTEP International said in its annual report that the decline in revenue was mainly due to the adjustment of retail channels. Net profit fell at the end of the year, which cost 150 million yuan for repurchase stock.

"The group is about to complete three years of strategic change, and has fully controlled the retail channel. In the future, it will pform the retail channel, strengthen the marketing of electronic commerce, and specialize in the market of running segments."

Compared with the leading Anta, Lining, the brand leader, and the implementation of multi brand strategy, XTEP international, which is committed to the pformation of fashion sports brands, is betting on the track of the sub field of running, but it has yet to see the pformation effect from its revenue and net profit.

Moreover, in the face of the channel sinking of front-line international giants and the accelerated penetration of foreign capital sports brands, how to make young consumers recognize brand value may be the biggest pain point.

This is also a problem that Anta and Lining need to face together.

Net profit decrease

2012 is the key year for the pformation and differentiation of local sports brands.

That year, the sports brand focused on the outbreak of inventory crisis. The optimism brought about by the Olympic Games four years ago became the fuse of the industry explosion.

"All the shoes produced in Jinjiang are enough to buy the whole industry for three years". This is no lack of joking phrases, but has become the best commentary on the promotion of local sports brand concentration in the future.

Jinjiang, the birthplace of sports enterprises, has also dropped from the more than 3000 sports brands at that time to the present dozen.

The sports brands who want to get out of the trough have also learned the lesson, adjusting the sales channels and embracing the electricity supplier. XTEP is one of them.

Since 2015, XTEP has begun to plan for pformation, but from the net profit performance, the result is not satisfactory.

In 2015, 2016 and 2017, XTEP's international net profit was 623 million yuan, 528 million yuan and 408 million yuan respectively, and it continued to fall behind the city, down 15.22% and 22.68% respectively.

From 2015 to 2017, XTEP's three year strategic pformation period.

In the 2017 annual report, XTEP International said that although the entity retail channel was still dominated by wholesale business mode, the group has changed from wholesaler to retailer by flattening the channel and encouraging exclusive distributor.

The cost of channel reform is the extension of accounts receivable.

XTEP extends the credit period of accounts receivable for wholesalers, and its general agent is responsible for most of the capital investment in the stores.

Despite the increase in agency receivables at the end of 2017, the number of accounts receivable turnover days was 137.63, significantly lower than the 173.26 in the medium term, but still increased compared with the end of last year.

In the same period, the turnover days of accounts receivable of Anta and Lining were 40.49 and 50.88 respectively.

For XTEP, which accounts receivable turnover is relatively high, upgrading the proportion of electricity providers has become an inevitable choice.

As a distribution channel, the electricity supplier has lower cost than direct stores, which is also conducive to inventory turnover.

XTEP International said that half of the electronic business platform products were fast made online products.

By the end of 2017, the company's e-commerce accounted for more than 20% of the group's total revenue.

M & A is still on the way

In fact, while adjusting the channel of e-commerce, XTEP also has to continue to add new outlets.

Especially for the local sports brand, the three or four line city is the key layout and fighting area.

Avoid direct confrontation with international brands, occupy the three or four line market share, and master Maori retail terminals to become the consensus of domestic sports brands.

Ding Shuibo, President of XTEP international, said in a 2017 performance press conference that the company plans to add more than 300 stores in 2018.

At the same time, XTEP also shouted slogans for the pformation of fashion sports brand in 2015.

On the one hand, XTEP sponsors marathon to strengthen its image in the field of running. On the other hand, Lin updated and Zhao Liying became the spokesman of his image, attempting to connect sports with fashion.

According to reporters, as of the end of 2017, XTEP has sponsored 29 important marathons and 11 running events.

Unfortunately, the blowout marathon did not bring XTEP's three year strategic performance improvement.

The deep ploughing of the international front-line sports giant in the Chinese market has also made XTEP more vulnerable to the situation of the former wolf and the tiger.

According to the latest reports, the number of Chinese middle class in 2016 has risen from almost zero in 1990s to 225 million today.

With the upgrading of social consumption and the rise of the new middle class, new consumer groups of sports goods have been formed.

The huge market cake also attracted the extensive participation of the first line international giants, including Nike, Adidas, Skech and so on, and international brands had already sunk to the three or four line channels.

The brand Puma, which specializes in fashion movement with XTEP, has also stepped up its offensive in China and has signed celebrity endorsements such as Liu Wen and Yang Yang.

Competition is inevitable. Buying other high-end brands is a good way to reverse the image.

Ding Shuibo also said in the media interview, "multi brand is also the focus of XTEP's future development, the goal is to acquire high-end international sports brand".

However, a reporter's access to relevant information found that, as early as 2009, the news of "XTEP's intention to acquire overseas brands" came out, but ten years later, XTEP, who holds nearly 3 billion cash, is still looking for suitable targets on the way of mergers and acquisitions.

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