Are You Able To Get Out Of The Gloom And Save Yourself?

(603555.SH) the declining trend has once again aroused concern in the industry.

According to the world clothing shoes and hats net, recently, the board of directors of the company has undergone large-scale personnel changes.

Guess.

In fact, over the past few years, the birds have been expanding in a crazy way. They have gone all the way in the way of "buy and buy". However, blind diversification has not only brought about the expected results, but has caused a series of sequelae such as falling share prices, declining performance, inventory growth and gross profit margins.

Insiders told reporters: since 2018, the birds have taken the strategy of selling assets and changing marketing channels to save themselves, and whether they can get out of the haze and return to their main business is not optimistic.

Board changes, executives leaving

In December 29, 2018, the company announced that the number of board members of the company was reduced from 11 to 7, of whom the number of non independent directors was reduced from 7 to 4, and the number of independent directors was reduced from 4 to 3.

At the same time, the board of directors of the precious birds received the resignation report of some directors and senior managers on that day.

Lin Tao resigned from the company's independent directors and Specialized Committee related duties of the board; Cheng hung resigned from the directorship, and the two men would no longer hold any post as a company after the resignation.

Lin Siping resigned as director and resigned as deputy general manager of the company. Li Zhiping resigned from his post as director and treasurer, and will continue to hold other duties in the company after his resignation.

In addition, the announcement also said that the board of directors of the noble bird will appoint the financial controller as soon as possible in accordance with the relevant regulations. Before the appointment of the new financial controller, Lin Sien, the director and deputy general manager of the company, will temporarily perform the duties of the financial controller.

It is worth noting that in December 11, 2018 of this year, the birds had announced that because of the existence of violations, the company's chief financial officer Li Zhiping, former director Zhou Shiyong and the current Dong Mihong were re issued by the Fujian provincial Securities Regulatory Bureau warning letter, ordered to carry out rectification.

The announcement shows that the inspection found by the Fujian Securities Regulatory Commission found that there were violations of the relevant deliberation procedures and information disclosure obligations, financial pactions not in accordance with the essence of pactions, and early recognition of assets disposal proceeds.

In the eyes of the industry, the change of personnel is related to the strategy of divest assets and direct pformation.

Shoes and clothing industry analyst Ma Gang told reporters that because of the failure of pformation and the poor performance, you can save yourself by selling assets and closing stores, and there is likely to be a disagreement within the enterprise.

Insiders also told reporters that such personnel changes also revealed the determination of the birds to start reform from within the company and from the management level.

In fact, since 2018, the birds have been making changes to pay for the bad pformation, and selling assets is the primary way to save themselves.

In early August 2018, the precious bird announced that it would pfer 37% of the shares held by the company: Kangpai sports management company limited to 37% of the Kang Paisi sports consulting company, and pferred to the Jinjiang National Sports City Limited by Share Ltd, which involved a total paction value of 143 million yuan.

In August 8, 2018, the noble bird announced that the 13.66% stake in tiger sports would be priced at 273 million yuan and pferred to Shanghai Ding Dian Asset Management Co., Ltd.

After the paction is completed, the birds will recover 239 million yuan of investment and make a profit of 30 million yuan. The principal and interest will be used to repay the principal and interest of the loan.

In December 2018, the precious bird folded its wings again, announcing that it would pfer its 50.01% stake in the sports industry development Limited by Share Ltd of Hubei (hereinafter referred to as "Jay's trip") with RMB 300 million yuan.

This paction will bring a loss of 130 million yuan to the birds.

In addition, channel pformation is another way to save yourself.

In December 12, 2018, the bird announced that it planned to pform the old part of the traditional "noble bird" brand distribution cooperation mode into a direct cooperation mode.

According to the announcement, the "noble bird" intends to buy some distributors' channel resources and recover some of their inventory.

Cheng Weixiong, general manager of Shanghai independent brand analyst, said in an interview with reporters that this series of actions has already conveyed the determination of the noble bird to return to its main business.

The war of diversity: stock prices plummeting, profit slipping, stock raising

It can be said that the expensive bird has paid a heavy price for its blind diversification.

In 2014, the great bird became the first stock of sports to land on the Shanghai stock exchange.

After the listing, the company announced the strategic upgrading target of "sports industrialization group based on sports apparel manufacturing and coordinated development of various sports industries", and began the "buy buy buy" expansion road.

At the beginning of 2015, the expensive bird bought 240 million shares for tiger sports and became the second largest shareholder of the latter. In July of the same year, it bought the equity of BOY 30.77%, a Spanish football brokerage company.

In 2016, the company bought the exclusive operation rights of the US basketball equipment brand AND1 in Greater China for 31 years. It also acquired the offline retail channel of the multi brand sports products such as Nike, ADI and so on.

In 2017, the noble bird announced that it would buy a 100% stake in Wellcome fitness for a 2 billion 700 million yuan high price in order to lay out the field of sports fitness, but it ended in failure.

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In addition to the above major acquisitions, the great bird has also had some layout in sports insurance, Internet sports games and so on, but none of them has caused great waves.

However, this series of acquisitions has brought many "sequelae" to the birds, and the first is the decline in performance.

Combing the performance report of the birds in recent years, the reporters found that from 2015 to the first half of 2018, the income of the precious birds was 1 billion 969 million, 2 billion 279 million, 3 billion 252 million and 1 billion 536 million respectively, and the net profit was 331 million, 292 million, 157 million and 34 million respectively.

From the data point of view, while revenue is rising, net profit is declining.

Insiders told reporters that this is related to the decline in gross profit margin of main business.

Data show that from 2015 to the first half of 2018, the gross profit margins of the main business sports shoes and apparel industry were 45.18%, 39.84%, 32.76% and 30.60% respectively, showing a declining trend year by year.

However, the gross profit margin of "sideline" vigorously developed by the great birds is also declining year by year.

Since 2016, the scope of the merger report has been added. Among them, the merchants business mainly comes from Jay's Bank and the famous shoe store, while the sports broking business comes from BOY.

However, in the first half of 2016 to the first half of 2018, the gross profit margins of investment and generation operations were 64.97%, 46.61% and 45.47% respectively, while the gross profit margins of sports brokers were 98.92%, 90.28% and 88.04%, respectively.

Moreover, after the diversification, the birds also welcomed the tide of closing shop.

From the first half of 2014 to the first half of 2018, the brand store of the "bird bird" brand changed from 4 to 3, and the number of franchisees decreased year by year, from 5022 in 2014 to 4461 in 2015, 4102 in 2016, 3726 in 2017, and 3523 in 2016. The rate of opening shop was not up to the speed of closing stores every year, and 1499 stores were closed in three and a half years.

Increasing inventory is another headache for diversity of birds.

According to the reporter's enquiry data, in 2015, the number of birds in the world was 170 million, and the stock turnover days were 63.72 days. By 2016, the increase in the end inventory of the precious birds reached 474 million, an increase of 177.98% and a turnover of 85.71 days.

Due to the combined effects of these factors, the price of expensive birds has fallen frequently since 2018. Public information shows that the company's market value has evaporated to over 14 billion yuan so far.

Ma Gang told reporters that the sports industry is more inclined to two aspects, one is sports events, the other is sporting goods and equipment consumption, which are two relatively large dimensions.

But the layout of sports birds in the sports industry is something conceptual.

In addition, the sports industry is a costly industry. Under normal circumstances, large consortia and large enterprises can enter, such as Wanda, Hengda, Huaxia happiness, and BAT, sunning and so on.

But the noble bird obviously has no such ability.

Cheng Weixiong admitted to reporters that the main business is not strong enough to ensure that the sideline industry is strong.

At present, the layout of sports industry diversification such as Pathfinder, great bird and so on is not successful. In contrast, Anta and other enterprises have achieved good results in their main business.

"A blind extension of the system, without complementation with the main business, is doomed to failure."

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