Shareholders' Profits Increased To 367 Million Yuan Year-On-Year, And The Total Dividend Payout Ratio Was 46.2%.

The results of the 2019 interim results show that the turnover reached RMB 3 billion 237 million yuan (the same below), an increase of 7.3% over the same period last year, a gross profit of about 1 billion 323 million yuan, an increase of 5.3% over the same period last year, a profit of 367 million yuan, an increase of 9.7% over the same period last year, and a basic earnings per share of 17.8 points.

Among them, children's clothing business and classified sales for others (i.e. sole sales) contributed 12% and 1.2% of the total revenue respectively. The remaining 86.8% revenue is mainly contributed by sales of 361o core brand products, 361o international and e-commerce business.

The two core products of the group, namely footwear and clothing, showed an upward trend, representing an increase of 3.8% and 12.1% respectively. During the review period, the spring and summer products over 85%2019 have been delivered and confirmed earnings.

In the second half of 2019, delivery was mainly for autumn and winter products in 2019. Last year, the group launched a logistics management optimization plan to get very positive feedback from both distributors and retailers. The plan is to establish cooperation with well-known e-commerce platform companies to help shorten the time when distributors send orders to retailers, thereby shortening the time to respond to market demands, thereby enabling companies to better manage channel inventory levels.

The proportion of footwear sales to total revenue was slightly increased from 45.2% to 43.7%, compared with the slight increase in clothing sales from 40.1% to 41.9% over the same period last year. During the review period, footwear products continued to be the main driving force for the group's strong development.

The income of 361o children's clothing increased by 6.6% to 388 million yuan per year, accounting for 12% of the group's revenue during the same period. The increase was mainly due to the increase in the average wholesale price of clothing products, resulting in an overall average wholesale price increase of 8.8% and a 2.1% decline in sales volume. The decrease in sales is mainly due to the change in product portfolio, the production of footwear and the decrease in sales volume.

In June 30, 2019, 361o group opened 5444 core brand stores, about 73.9% of which were independent street shops. The group plans to open more new stores in shopping malls and department stores in the future. In June 30, 2019, about 74.9% of the stores were located in three or less cities in China, while 6.6% and 18.5% stores were located in China's first and second tier cities respectively. In the future, the group will continue to focus on improving store efficiency and retail sales.

In addition, a total of 1837 outlets provide 361o children's clothing products, 536 of which are located in the 361o core brand authorized retail store, while selling 361o core brand products and 361o children's clothing products. Of the 1837 sales outlets, 72% were independent street shops. By region, about 68.5% are located in China's three and below cities, while 7.3% and 24.2% are located in China's first and second tier cities respectively.

As of June 30, 2019, Brazil, the United States, Europe and China Taiwan respectively had 1505, 476, 739 and 107 sales outlets of multi brand sports products for the sale of 361o products.

At present, the European sales network covers countries such as Britain, Germany, France, Austria and Switzerland. During the review period, the group successfully entered new markets such as Russia. The group will continue to explore and expand overseas countries and regions with growth potential in order to promote the international version of products. In order to make product differentiation and meet the needs of consumer upgrading in the domestic market, the group will also introduce 361o international products to more 361o stores in China.