Evaporation On A Single Day Is 8 Hundred Million! 8 Of Revenue Came From Nike And Adi, And BELLE Was Greatly Reduced.

In June 11th, Nike and Adidas, the largest retail partner and customer in China, announced that in June 10th, the BELLE sports announcements company, the controlling shareholder of the company, had entered into a block trading agreement with the Asia Pacific Limited company. Accordingly, the distributor has agreed to compete independently with the international market at the price of HK $10.50 per share. None of the 276 million 800 thousand shares of the company held by the seller were sold, and the shares sold accounted for about 4.46% of the total issued shares of the international stock as of today.

The placement plan was delivered in June 15th. The amount involved amounted to HK $2 billion 900 million (about US $374 million). Before the transaction, BELLE sports held 5 billion 141 million shares, which accounted for about 82.91% of the total issued shares. After the completion of the transaction, BELLE's shareholding will drop to 78.45%, and it is still the international controlling shareholder.

Affected by this news, Tao Bo international early morning opened sharply lower. As of press release, Tao Bo International reported 10.14 yuan / share, a decrease of 12.13%, with a turnover of HK $2 billion 926 million and a turnover of 338 million shares. The market value also decreased by 8 billion 1 million yuan to 57 billion 284 million yuan from 65 billion 285 million yuan in June 10th.

The first textile network reporter noted that Tao Po international landed on the HKEx in October 10, 2019, issuing a price of HK $8.5 / share on that day and gaining 11.54 yuan / share in June 10, 2020.

According to public information, Tao Bo international is China's largest sportswear retailer. According to Forster Sullivan data, in 2018, the company accounted for 15.9% of the retail market share, ranking first in the industry. Tao Bo international established 15 and 20 years' strategic partnership with Nike and Adidas respectively. After listing in 2006 and delisting after privatization in 2017, the international business was reorganized.

The first textile network is reported that the prospectus is informed that BelleSports, which is indirectly controlled by BELLE international executives, Gao Ling capital and CDH, is the controlling shareholder of Tao Bo international. Its shareholding ratio is as high as 85%. MuseHoldings (established for the purpose of BELLE international privatization) has a wholly owned BELLE International through MuseB and MuseM and BelleSports, and has a 85% stake. Sage Entrepreneurship (BELLE international top management), HillhouseHHBH (high leverage capital control) and SCBL (CDH investment control) hold MuseHoldings46.36%, 44.48% and 9.16% shares respectively, and the public stock issue is 15%.

According to the financial reports, the international revenue growth rate in the past 5 years has been steadily improving. The growth rate of business revenue of 2015-2019 has been 15.2%, 14.7%, 14.8%, 22.4% and 22.7% respectively. In May 25th, the international financial report released in February 29, 2020 for the 2020 fiscal year shows that the company's operating income is RMB 33 billion 690 million yuan, an increase of 3.46% yuan, operating profit. For RMB 3 billion 303 million yuan, a year-on-year increase of 2%, the net profit attributable to the parent company was 2 billion 303 million yuan, an increase of 4.7% over the previous year. During the reporting period, although the outbreak had a significant impact on financial performance, the core business remained stable:

According to the channel, the retail business income was 29 billion 171 million yuan, accounting for 86.59%, down 2.39pcts compared with the same period last year; wholesale business was 4 billion 223 million yuan, accounting for 12.53%, up 2.23% over the same period; the cost of joint venture was 266 million yuan, accounting for 0.79%; and the income of electric competition was 30 million yuan, accounting for 0.09%. The increase in the proportion of wholesale business is due to the new partner of Tao Bo international, but in the future, it is still dominated by retail outlets.

From the brand perspective, sales of main brands (Nike and Adidas) reached 29 billion 490 million yuan, accounting for 87.53% of revenue, up 0.77pcts from the same period last year; sales of other brands were 3 billion 904 million yuan, accounting for 11.59%, down 0.97pcts compared to the same period last year. Compared with the same period last year, the proportion of the company's brand revenue in 2019 remained relatively stable, and the core business remained stable overall.

In terms of analysis, Tao Bo international is Nike's second largest retail partner and customer in the world, as well as Adidas's largest retail partner and customer in the world. Nike and Adidas (main brand) are the two largest brands that have contributed most to the international sales revenue and the deepest cooperation. From the perspective of sales revenue, they are 90%, 89.4%, 87.4% and 88.6% respectively in the first half of 2017-2020 years.

From the point of view of the channel, in 2019, Tao Bo international opened 1416 new stores, closed 1364 stores, and increased 52 stores. Gross sales area grew by 10.6%, and its 8395 stores have covered nearly 300 cities throughout the country. Among them, the proportion of shops with an area larger than 300 square meters increased from 2.63% in 2017 to 7.29% in 2019.

According to the international data of Tao Bo, Ding Shijie, an analyst with Guoxin Securities, expects that the total area of international stores in the 2020 fiscal year is about 1 million 440 thousand square meters, with a single store area of 171 square meters, with an average store effect of 3 million 480 thousand yuan per year and a flat effect of about 21 thousand and 300 yuan per annum. Due to the increase in the first 11 months of the international epidemic, about 13% in the previous month, assuming that the retail revenue of the epidemic increased by 12% compared with the previous year, the effect of the epidemic was estimated at 3 million 878 thousand yuan per year, an increase of 11.4% over the same period last year, with a plateau effect of about 23 thousand and 700 yuan per year, an increase of 1.8% over the previous year. Under the premise of a significant increase in the single store area, the company's performance has been further enhanced, which confirms the high quality of the new shops and the effective strategy of the big stores. Moreover, a large number of new stores have been operating for a short time. It is expected that the new stores will further enhance the performance of shops to maturity level this year, and continue to promote the growth and profitability of the company.

Reporters learned that, during the epidemic, Tao Po international adopted various means to make up for sales, and realized the rapid expansion of the digital business before the outbreak. The proportion of digital revenue in sales revenue has been significantly improved after the outbreak: the number of high and medium units before the outbreak, the peak period of 40-50% is 10-20%, and the epidemic situation has been stabilized after the outbreak. Further opening up stock sharing, increasing the flexibility of inventory circulation; two is to enhance the O2O coverage, from the original 30% stores Unicom to 85% during the epidemic period, the number of small program stores doubled; three, mobile cash register promotion, from the previous attempt in individual communities, to 90% shops during the epidemic season, and realized the transfer of the selling scenes in special times.

In addition, the huge membership system of Tai Po international has also played an indelible role. In 2016, Tao Bo International launched the "TopFans" membership plan, extending the idea of serving consumers horizontally to the entity store network. In May 2018, Tao Bo international adjusted the "TopFans" membership plan and provided a wider membership benefit to its members in terms of products, services and activities. As of August 31, 2019, the total number of registered members was 21 million 200 thousand, the number of active members was 5 million 900 thousand, and the total retail sales contributed by the staff plan had reached 81.4%, which was about 45pct higher than that of a year ago. As of February 29, 2020, the number of registered members of the company reached 27 million 200 thousand. In December 1, 2019 to February 29, 2020, the proportion of total sales of registered members contributed 91%.

Shi Hongmei, an analyst at Orient Securities, has pointed out that Nike and Adidas have played a very important role in China's success in the past. On the one hand, Tao Bo international is one of the pioneers of adopting a single brand store model in China, that is, most stores sell a specific brand of sports shoes and clothing products. Meanwhile, the internal design and layout conform to the global brand image, helping partners establish and strengthen brand image. Nike and Adidas have tried various strategic stores in China. On the other hand, the company maintains frequent communication with its brand partners to share the company's views on the Chinese market, consumers and products. By the end of 2019, it was the only retail partner in mainland China who regularly shared with Nike global headquarters the insights of Chinese consumers and product needs. Product line and brand positioning strategy.

At the same time, since 2006, Tao Bo international has established a cooperative relationship with 9 brands. Of them, 6 of them have worked together in 2015. After that, the company is expected to help consumers design and produce better products for the Chinese market with the help of consumers' cognition and insight accumulated over the past decade. In addition, it can help improve the brand's overall strategy in China, including brand positioning and camp. Sales, product and store design, retail pricing, etc. From the perspective of revenue growth over the past 2 years, the growth rate of other brands has always been higher than that of the main brands because of the low growth rate, and this trend is expected to continue.

In the view of Shi Hongmei, Tao Bo international and Nike and Adidas have gone through 20 years and 15 years of strategic cooperation respectively. As Nike is currently the second largest partner in the world, it is also Adidas's largest retail partner in the world. According to the data of Nike and ADI's sub regional reports and the corresponding sub brand data, rough calculation shows that in the 2019 fiscal year, Nike's and Adidas's brand businesses account for 20-25% of their respective Greater China sales. In addition, thanks to the long-term competitive strength in the field of sports apparel, Tao Bo international is also the largest partner of most other international brands currently distributing in China. Shi Hongmei believes that Tao Bo international can fully share the high popularity of sports brands in the Chinese market and become a booster and accelerator for the rising period of cooperative brands.

In the view of Shi Hongmei, as Nike's second largest partner in the world, Adidas is also the largest retail partner in the world, thanks to its long-term competitive strength in the field of sports apparel and the largest partner of most other international brands currently being distributed. To help cooperative brands design and produce better products for the Chinese market, it can also help improve the brand's overall strategy in China, including brand positioning and marketing, product and store design, and retail pricing. It can fully share the high popularity of sports brands in the Chinese market and become a booster and accelerator for the growth of cooperative brands.