Monday, July 15, 2024

China Dongxiang Announces FY2023/24 Annual Results; Revenue Increases to RMB1,744 Million; Sporting Goods Business in China Achieved Turnaround in Operating Profit

Distributes Special Final Dividend of RMB0.51 Cents Per Share 
Accumulative Payout Ratio Totalled 88% Since Listing

Results Highlights

Revenue amounted to RMB1,744 million, representing an increase of 3.9% year-on-year (YoY); Gross profit amounted to RMB1,192 million, representing an increase of 12.0% YoY; Gross profit margin increased by 4.9 percentage points YoY to 68.3%; Operating profit of sporting goods business in China was RMB106 million, representing remarkable growth as compared to operating loss of RMB15 million in the corresponding period; Operating loss of investment segment was RMB726 million; Net loss attributable to owners of the Company amounted to RMB639 million; Recommended the distribution of a special final dividend of RMB0.51 cents per ordinary share for the 12 months ended 31 March 2024; the Group’s accumulative dividend and payout ratio since listing amounted to RMB7.9 billion and 88%, respectively; KPIs of sporting goods business in China continued to improve: net inventory value amounted to RMB286 million, a decrease of 14.9% YoY; overall turnover and store efficiency for the year achieved growth of 10% to 20% and 20% to 30%, respectively; Strong financial position: cash and bank balances amounted to RMB3,035 million, current ratio improved YoY.

HONG KONG, June 26, 2024 /PRNewswire/ — China Dongxiang (Group) Co., Ltd. ("China Dongxiang" or "the Company", together with its subsidiaries, "the Group", HKEX stock code: 3818), the leading international sportswear brand enterprise in the PRC, announced its annual results for the 12 months ended 31 March 2024 (the "Reporting Period").

Financial Results

During the Reporting Period, recovery of the global economy was weak. Coupled with the impact of external and internal factors, as well as volatile financial markets, the global economy was besieged by challenges. The Group has improved its offline channel mix, optimised the flexible supply chain management, and strengthened the synergy and complementarity of its business system. The outstanding performance of the core products collectively enhanced the overall sales performance.

During the Reporting Period, the Group registered a revenue of RMB1,744 million, representing a 3.9% increase YoY. Gross profit amounted to RMB1,192 million, representing a 12.0% increase YoY. Gross profit margin increased by 4.9 percentage points to 68.3%. The operating profit of sporting goods business in China was RMB106 million, representing a strong growth as compared to operating loss of RMB15 million in the corresponding period. Affected by the volatility of the global stock market, the operating loss of the investment segment amounted to RMB726 million. Net loss attributable to owners of the Company amounted to RMB639 million. The Board of Directors has recommended the distribution of a special final dividend of RMB 0.51 cents per ordinary share for the 12 months ended 31 March 2024, with accumulative dividend and payout ratio since listing amounting to RMB7.9 billion and 88%, respectively.

Operational Highlights

Strengthened supply chain resulted in revenue growth of sporting goods business in China

The Group’s KAPPA brand focused on the optimisation of the direct-to-franchise model and single-store efficiency, which achieved initial results in improving the presence of its offline channel mix. Meanwhile, the Group reformed its online e-commerce channel and its proprietary quick response model to ensure the effective operation of the supply chain, enabling it to optimise operational efficiency and reduce operating costs. As a result, the overall sporting goods business in China turned around with an operating profit of RMB106 million. The turnover contribution rate and sell-through contribution rate of inventory replenishment both achieved double-digit growth under the flexible supply chain mechanism.

The Group continued to strengthen the competitiveness of the KAPPA brand and implemented the de-advertising marketing strategy, focusing on its target consumers to launch powerful offline activities that built resonance through an emotional marketing strategy. KAPPA actively sought cross-sector collaborations and became the apparel sponsor of the popular variety show, "We Never Stop", during the Reporting Period, which significantly increased brand exposure and awareness.

As at 31 March 2024, the Group had a total of 1,012 Kappa stores (excluding Kappa Kid’s stores), representing a net decrease of 11 stores as compared to that as at 31 March 2023.

PHENIX topped the online sales channels for two consecutive years

The Group’s PHENIX brand has been specialising in high-end professional skiing equipment. During the Reporting Period, the PHENIX brand developed multiple product series, such as the NORGE Norwegian Alpine Ski Series, MISS PHENIX high-end ladies’ fashion series, the young and fashionable SP27 and X-niX Series, as well as the functional lifestyle series – alk phenix and +phenix product series. In addition, PHENIX has cooperated with a number of well-known domestic ski athletes during the past ski season, organising the PHENIX FREERIDE training camps to provide more professional and safety courses for avid skiers, thus promoting the development of winter sports in China.

During the Reporting Period, the GMV of PHENIX’s brand in e-commerce omni-channel increased over 80% YoY, with online sales volume increasing over 100% YoY. PHENIX brand ranked first among ski brands and third among snowboard brands on Tmall industry rankings, further consolidating its position as a leading ski brand in the market.

Ms. Cherry Chen, Chief Executive Officer, President, Co-Chairman and Executive Director of China Dongxiang, said, "The various stimulus measures from the Chinese Government will bring enormous opportunities to the sporting goods industry. China Dongxiang holds an optimistic view on the prospect of China’s leisure sportswear industry. The Group will continue to seize market opportunities and develop more quality products, in a bid to bring customers a better consumer experience and enhance brand competitiveness. Moreover, as a leading fashion sports brand in China, China Dongxiang attaches great importance to Environment, Social and Governance (ESG) and sustainability, and will keep closely in step with the Chinese government’s reduction in emissions to promote green development, and strive to establish a sound governance structure, actively conveying the concept of a green planet to consumers."

– END –

About China Dongxiang (Group) Co., Ltd. (Stock code: 3818)

China Dongxiang (Group) Co., Ltd. is a leading international sportswear brand enterprise in China which has been listed on the Main Board of the Hong Kong Stock Exchange since 10 October 2007. The Group is primarily engaged in the design, development, marketing and wholesale of branded sportswear in China. Currently, China Dongxiang owns all rights to the internationally renowned Kappa brand in Mainland China and Macau. Since April 2008, the Group became the owner of the brand PHENIX. PHENIX is a well-known skiing brand in the international market.

Issued by Cornerstones Communications Ltd. on behalf of China Dongxiang (Group) Co., Ltd.. For further information, please contact:

China Dongxiang (Group) Co., Ltd. 
Investor Relations Department
Christina Low / Tiffany Liu
Tel: (86) 10-6783 6585
Email: [email protected]

Cornerstones Communications Ltd.
Sharis Siu / Ronald Liu
Tel: (852) 2903 9292/ 2903 9287
Email: [email protected]

Source : China Dongxiang Announces FY2023/24 Annual Results; Revenue Increases to RMB1,744 Million; Sporting Goods Business in China Achieved Turnaround in Operating Profit

>

This content was prepared by our news partner, Cision PR Newswire. The opinions and the content published on this page are the author’s own and do not necessarily reflect the views of Siam News Network

Must Read