Core Drive Strong Release Anta Sports First Half Net Profit Growth Of 27.7%

26, the semi annual report released by Anta sports revealed that in the first half of the year, the company achieved operating income of 14 billion 811 million yuan, an increase of 40.3% over the same period last year, and realized a net profit of 2 billion 483 million yuan, an increase of 27.7% over the same period last year. The company's FILA brand grew strongly, becoming the biggest highlight of Anta sports semi annual report, and the core driving force of the company's performance continued to grow.

At the performance briefing held on the same day, in response to a question raised by the China Securities Journal reporter about the first detailed disclosure of FILA core data in the semi annual report, the company said, "at present, the proportion of FILA in the company's business has accounted for over 40%, and the company has the responsibility to give investors a clearer understanding of FILA." Insiders pointed out that the first detailed disclosure of FILA core data of another layer of meaning, objectively hit back muddy water short before, is expected to further strengthen investor confidence.

Strong growth of FILA brand

The strong growth of FILA brand has become the biggest highlight of Anta sports semi annual report. In the first half of this year, FILA brand realized business income of 6 billion 538 million yuan, an increase of 79.9% over the same period, accounting for 44.1% of Anta's overall revenue. In the first half of this year, Anta realized gross profit of 3 billion 225 million yuan, an increase of 14% over the same period last year, and the gross profit of FILA brand was 4 billion 673 million yuan, an increase of 79.2% over the same period last year. This is the first time that the FILA brand has surpassed Anta's gross margin.

In the company's semi annual performance briefing, FILA brand has become the focus of attention. Zheng Jie, executive director of Anta sports, President of Anta group and Lai Shixian, executive director of Anta sports and chief financial officer, mentioned the achievements of FILA brand in the first half of the year. "In the first half of this year, Anta sports gross margin increased 1.8 percentage points to 56.1% compared to the same period last year, mainly due to the contribution of FILA brand." Lai Shixian said.

In July of this year, 5 reports of muddy water continued to be reported to attack Anta sports, and Anta sports responded one by one. Anta sports shares were not affected, but even hit a new high, and the investment institutions such as brokerages were strong, muddy water failed. Anta sports in the semi annual report of the muddy water in the short report questioned the core data of FILA brand for the first time in detail.

For the China Securities Journal reporter about the "first detailed disclosure of FILA brand core data" problem, Zheng Jie said, "there is no counterattack. Judging from the current situation, FILA brand has accounted for more than 40% of Anta sports business, Anta sports has the responsibility to give investors a clearer understanding of FILA brand.

Zheng Jie explained the operation mode of FILA brand in detail. Compared with the wholesale distribution mode of Anta brand, FILA brand is mainly operated by direct operation. "In the first half of this year, the FILA brand opened its stores and stores in the core cities, and was among the best in the category brand. These big shops opened by FILA brand make the concept of high-end sports and fashion popular among the people.

As the first international brand of Anta sports, FILA has become an important driving force for Anta's growth in sports performance in recent years. In August 2009, Anta sports announced the purchase of BELLE's international sports brand FILA in China with a total price of HK $600 million. The acquisition, which was seen at the time, was revitalized after the integration of Anta sports, and formed a strong complementary effect with Anta brand. FILA

In 2011, FILA made a strategic change in the Chinese market, that is, brand positioning "return to fashion", and made corresponding adjustments in product design, sales channels, supply chain and marketing, so as to make full use of the high-end consumers in the second tier cities. In 2014, FILA reversed its decline to make profits. So far, FILA has been revitalized by Anta sports and has become a strong driving force for the company's growth.

Tianfeng Securities pointed out that the successful operation of FILA brought Anta brand confidence in many brand operations and provided management experience for international high-end brands. After the successful operation of FILA, Anta sports bought Korean outdoor brand Kolon, mountaineering brand Sprandi, winter sports brand Descente and children's wear brand Kingkow. This indicates that Anta's brand has basically covered all kinds of sports products market segments.

Market value exceeds HK $160 billion

With the sustained and rapid growth of performance, Anta sports shares have risen. In August 26th, the stock price of Anta sports closed at HK $61.25 / share. Since the beginning of this year, the share price has risen to 64.01% and its market value is HK $165 billion 500 million. It is 3 times the number of the main competitor of China, Lining, more than 14 times of XTEP international, and has become the super white horse stock in the sportswear subdivision.

From the early 2007 when the market capitalization of only HK $about ten billion of small and medium capitalization companies, Anta sports how to step by step to grow into super white horse stock? Tianfeng securities, Soochow securities and other major brokerages have attributed the main reasons to 3 points: dedicated technology research and development, accurate brand marketing and multi brand operation. After studying the development process of the two giants of Nike and Adidas, Soochow pointed out: first, R & D and marketing are the biggest driving force for the success of sporting goods. Take Nike as an example, on the one hand, the founder team athletes came from the family, attached great importance to technology research and development, and made breakthroughs from early huff shoes, Agam shoes to slow shock technology and vamp technology, and built a powerful product moat. On the other hand, the star resources will be captured first. Early signing more than two thousand track and field players, after signing Jordan in the basketball market, signed the Liu Xiang and Li Na in the Chinese market, and constantly enhancing the brand influence; secondly, through the multi brand strategic layout differential segmentation track, it helps the enterprises to grow rapidly.

As far as R & D is concerned, as early as 2005, Anta sports established the first national sports science laboratory in China. It has applied for more than 1200 national innovation patents, and has provided professional competition equipment for 36 national teams. In recent years, R & D investment has accounted for more than 5% of the total cost of sales. In April of this year, Anta launched a brand new "hydrogen running shoes", which was developed by Anta's hydrogen technology. The lightest style only weighs 110 grams. It is Anta's first running shoes with light weight as its main selling point.

In terms of marketing, Anta's advertising expenditure in 2018 amounted to 2 billion 916 million yuan. In addition to a strategic cooperation with the Chinese Olympic Committee and signing NBA stars represented by Clay Thompson, he also sponsored various competitions. In the first half of this year, as the official partner of the Chinese Olympic Committee, Anta launched the "Anta x Winter Olympic Games" jointly with the the Imperial Palace literary creation on the 1000 day of the 2022 Beijing Winter Olympic Games, attracting many consumers' attention online and offline.

In terms of multi brand operation, in recent years, through the continuous improvement of "single focus, multi brand and all channel" strategy, Anta sports has formed a brand coverage matrix of consumers' full coverage and channel coverage. In March this year, Anta sports and other investors consortium completed the acquisition of AMER SPORTS, an important step in internationalization. In April, the new board of directors of AMER SPORTS was established, and the five year development strategy to stimulate its growth potential and its growth plan in the Chinese market were formulated.

Organizational transformation and upgrading, "practicing internal strength"

In the first half of this year, Anta sports continued to "improve its internal strength" through the upgrading of organizational transformation. "After years of development, Anta sports has gone through four stages of innovation and upgrading: 1 manufacturing, 2 creating brand, 3 retail transformation, and 4 brand development. Every transformation is a subversion of the past. " Ding Shizhong, chairman and chief executive officer of Anta group's board of directors, said.

Anta sports this year launched the "collaborative value year" to implement organizational change to effectively enhance management efficiency and collaborative incubation. In the first half of this year, Anta sports formed three major brand groups: Anta, Anta children, SPRANDI, AntapluS professional sports brand group; FILA, FILA FUSION, FILA KIDS and KINGKOW fashion sports brand group; AMER SPORTS, DESCENTE, and AMER as the representative of outdoor sports brand group.

"The new structure clearly defines the division of business brands and effectively achieves collaborative incubation. At the same time, the new framework defines the division of responsibilities and collaboration interfaces among different organizations to enhance the efficiency of organizational collaboration. Zheng Jie said that the three brand business groups have corresponding functions of design, brand, sales and distribution, so as to promote "category system" in an all-round way. At the same time, the group set up an independent team to co-ordinate retail, procurement, production and e-commerce to achieve the best synergy effect.

With the upgrading of the organizational structure, Anta's main brand continues to upgrade. In the first half of the year, brand marketing, technological innovation and cross-border joint products have been continuously breakthroughs. For example, to celebrate the birth of Coca-Cola 133rd anniversary, Anta and Coca-Cola jointly launched a number of joint shoes and costumes, and with "happiness" as a promotional selling point, enthusiastic response. Author: Jiang Yuling