361 Degree Inflection Point? Sun Yang'S Profit Warning Stock Price Dived After "Dressing Door"

Last year, Sun Yang's "dressing door" incident, which was famous for 361 times, is now suddenly "out of favor".

In February 15th, 360 degrees fell 10% in Hongkong, possibly due to a profit warning issued at 31st, February 14th.

By the end of 2018, in the fiscal year of 2003, the tax net profit of the group was significantly lower than that in 2017.

The announcement did not give a relevant decline.

The explanation for the sharp decline is that the Chinese people's desire for consumption of non essentials is relatively conservative. As a result of the decrease in repurchase orders, the rearrangement of logistics delivery schedules and the brand remolding plan launched in the second half of 2018, the total orders in 2018 decreased as a whole. The depreciation of the RMB against the US dollar resulted in the loss of foreign exchange; and because of the increase in advertising and publicity costs, the company's e-commerce business recorded a substantial loss in 2018.

The 2017 industry data released by the Statistics Bureau in January showed that the total output and added value of China's sporting goods and related products increased by 12.9% and 14% to 1 trillion and 300 billion yuan and 326 billion 460 million yuan respectively.

Although the growth rate of consumer goods in China has slowed down in 2018, the sports and sporting goods industry has maintained a high growth rate.

In the same market environment, sports brands such as Lining and Anta did well.

Anta, Lining and other brands are obviously developing at a rapid pace.

Public information shows that the group was founded in 2003 and was successfully listed on the main board of Hongkong stock exchange in June 30, 2009.

Guotai Junan Securities Research Report shows that the 360 degree children's wear brand has become the only growth engine of the company, while other business segments, including core brands, international business, and so on, become less competitive and difficult to maintain steady growth in the current weak market environment.

The same store sales growth of the company's children's wear brands remained strong, but the growth of the same store sales of the main brand deteriorated seriously in the second half of 2018.

Song Qinghui, chief economist of Ching Hui think tank, told time finance that the declining trend of the 31st degree was gradually showing that compared with the local sports brands such as Lining, Anta and XTEP, there was no core competitive advantage, and the gap between Anta and other brands was further expanded.

On the other hand, the brand that belongs to the low line city is a high-end advertising, but the brand positioning is not clear, the R & D investment is insufficient, the advertising investment is not compatible with the low-end sales and so on.

Shutting down shop

The gap between Anta and Anta sports seems to be getting farther and farther away.

In the past two years, sales have continued to lose profits.

The famous rating agency, S & P, will have a 360 degree rating outlook at the end of January, from "stability" to "negative".

The 31st degree growth rate slowed down as early as possible. Public figures show that in 2016, the group's operating income was 5 billion 23 million yuan, an increase of 12.65% over the same period last year, and the gross profit grew 15.74% to 2 billion 110 million yuan over the same period.

In 2017, the group's operating income was 5 billion 158 million yuan, up 2.7% from the same period last year, and gross profit rose 2.2% to 2 billion 156 million yuan over the same period last year.

Although the growth rate of the group is still slowing down, it is an indisputable fact.

Meanwhile, the number of stores is declining.

Time and money combed 31st degree financial report found that as of December 31, 2017, a total of 5808 core brand stores were opened, compared with 549 in 2016.

Compared with the 7208 in 2015, the number has decreased by 1400.

It is worth mentioning that the 31st degree children's clothing is the first project of capital operation after the listing of the 31st degree group in 2009. The 31st degree group will use 9% of the proceeds raised for the research and development of children's clothing brand.

What is surprising is that the children's clothing has been closed frequently in recent years.

According to the data, there were 2350 children's clothing sales in 2015. In 2016, the sale point of children's clothing was reduced to 2000 in 2016. In 2017, the sale point of children's clothing was further reduced to 1797.

Looking at the development of children's clothing and deterioration of market competition in recent years, it is not easy for us to break through.

A survey published by an information consulting firm revealed that Adidas has been in the forefront of the domestic children's sportswear market in recent years.

Anta's children's clothing business has also grown significantly.

In 2017, Anta acquired the famous Hongkong children's wear brand Xiao Xiao Niu.

At present, Anta owns Anta children, Fei Le children and other brands, opening up the multi brand strategy of sports children's wear.

Cheng Weixiong, an independent analyst in footwear industry and general manager of Shanghai Liang Qi brand, said that although the sports brand is in the development stage, the domestic brands are relatively homogeneous, and the main brand has been growing feeble.

At present, the top four brands have launched a series of children, but in fact, children's clothing market has also been overcrowded.

At present, domestic brands are still in the traditional stage of "price comparison".

Despite the great setbacks in Lining sports in the last few years, with the launch of the founder Lining in 2015, Lining sports finally ushered in a loss and ended the loss for three consecutive years.

Cheng Weixiong believes that the current domestic health industry is rising, for the sports brand is in the shuffle stage.

At present, Anta is in the leading position of the domestic sports brand, and Lining is in the period of repair. It is difficult for XTEP to surpass XTEP.

High and low open

As one of the four major sports brands in China, 360 degrees have never been stingy about advertising expenses. In this profit warning, we also mentioned that the electricity business of the company recorded a substantial loss in 2018 due to the increase in advertising and publicity costs.

What is impressive is that in August 19th last year, the Chinese swimmer Sun Yang did not accept the award of the Chinese delegation's award in accordance with the contract requirements, but chose another brand of 360 degrees.

As a matter of fact, the most public opinion has completely exploded, and from the side it also reflects the ambition of increasing the sponsorship of sports events.

According to the related reports of time and finance, 31st degree has started sponsoring Asian Games and other sports events since 2010, including the 2010 Asian Games in Guangzhou, the Inchon Asian Games in 2014 and the official partners of the Rio De Janeiro Olympic and Paralympic Games in 2016.

Statistics show that the 2010 Asian Games in Guangzhou, 361 degrees as a sponsor, opened up the Guangdong market on the way. In 2016, the Rio Olympic Games, 361 degrees successfully entered the Brazil market; the Asian Games in 2018, 361 degrees had reached the cooperation with Matahari, the biggest local dealer in Indonesia, and entered the Indonesia market by the Asian Games.

In addition, the 31st degree was also on the "side" competition to find breakthroughs. In March 22, 2018, 31st degree announced the cooperation with QG club to promote the brand younger.

Although the high-end sponsorship events have been used to boost brand awareness, however, it is still the low-end brand of the three or four tier cities from the layout and market distribution of the 361 degree stores.

According to the China Times report, from the analysis of the market layout of 361 degree, 361 degrees has been tilting to three or four line cities in recent years: the number of stores in the first tier cities and the second tier cities are about 8.3% and 18.2%, respectively, and 73.5% stores in China's three cities or below.

Not only was the store opened to a lower level of economy, but in February 2018, 500 million of investment in Sichuan was built in Dazhu, and it entered the western market of China.

Some people in the industry believe that the 361 degree is mainly in the three or four line city, which is related to the R & D and positioning of its products. This is also a realistic reflection of 361 degrees only paying attention to brand instead of overweight, because a second tier city is hard to get the real recognition of users.

361 degrees to enter the western market of China, but from the point of grasping the consumer market of China's three or four tier cities, the pace of the company's sponsorship of high-end events is not consistent.

At present, there are Anta and Lining's "catch up" in China. Foreign countries have Nike's "interception".

The above attempts have not brought any immediate results to them, and they are still trapped in the slowdown.

It is still facing many challenges to break through the bottleneck and rise again.

Jinjiang sports Kingdom anxiety

After the controversy about Sun Yang's "dressing door", Jinjiang's D1, represented by the 31st degree and Anta, once again entered the public view.

These shoe companies are not only in the birthplace of Jinjiang, but also look at these ringing names: Anta's Ding Shizhong, XTEP's Ding Shuibo, Jordan's Ding Guoxiong, 361 founder Ding Jiantong, current president Ding Wu...

Without exception, all of them are ding.

In addition, PEAK, Hongxing Erke, del Hui, Kang Tai, noble bird, Qipai, Li Lang and Jin lake are all famous in Jinjiang.

Almost all of the advertisements that were broadcast on CCTV5 in 2003: sports stars / Hong Kong and Taiwan stars wear Jinjiang shoes with logo's close-up.

In 2006, the world cup in Germany was even more exaggerated. 1/4 of the advertisements on CCTV5 came from Jinjiang brand, and CCTV5 was once ridiculed as "Jinjiang channel".

According to the information of the foresight Industry Research Institute, Jinjiang is a county-level city with a permanent population of only about 1600000. In 2011, GDP (gross domestic product) was as high as 107 billion yuan, and its per capita GDP exceeded 66 thousand yuan, which was remarkable.

Its pillar industries are sports shoes and clothing - there are only more than 3000 such enterprises in Chen Dai Town, with an annual output of more than 500 million pairs of sports shoes, accounting for half of the total output of national sports shoes.

At present, Jinjiang has more than 40 listed companies in the world, the largest number in the country's county-level cities, second only to Jiangyin, Jiangsu.

Some of them have been listed on the market, such as Hongxing ERK, but many enterprises have not expanded their popularity after listing. For example, China Sports International Co., Ltd., which was listed in Singapore in 2007, China Sports International Co., Ltd., listed in Canada in 2009, and hung star Wordenka (Worldcape), which was listed on the Korean exchange in May 2009.

With more and more fierce competition and higher cost, many large brands have begun to pfer their capacity to inland provinces and cities, and marketing centers or headquarters have moved to places like Xiamen and Shanghai.

For example, Anta moved part of its capacity to Fuyang, Anhui, where the birds set up factories in Anhui and Wuhu, and the wolves and BELLE set up factories in Suzhou, Anhui.

For the shoe industry in Jinjiang, opportunities, crises and opportunities follow, and opportunities and challenges go hand in hand.

Huang Tao, vice president of Dan sports, believes that the market is reshuffling, and that the market for the next 60% will be concentrated in 3~5 enterprises.

If we want to win the future competition, we must take the road of brand cluster and technology cluster.

As the rent rises, it is inevitable that those inefficient shops will eventually be eliminated.

After a burst of growth, and almost simultaneously entered a bottleneck period.

In 2018, Jinjiang suddenly became a "pformational anxiety city" with multimedia reports.

Although Jinjiang shoe enterprises are not as brilliant as they used to be, they can survive and survive well. There must be some serious points. But the industry pformation and adjustment are still in progress. How to achieve sustained and strong competitiveness is still a matter of concern.

Today, profits have fallen and performance has slowed down, which has led the industry to worry about it.