Anta Sports, the Chinese sports brand, lifted its sales by 20.2 percent to 8,904.8 million renminbi (€1,051.4m-$1,411.8m) last year, outperforming the Chinese market. Yet the company emphasized that the country's sports industry was under pressure, with over-capacity and increasing discounts, which called for a more cautious approach in retail expansion.
Anta said that it had been growing fastest in the southern region, where its sales jumped by 28.6 percent to RMB 3,291.6 million (€388.6m-$521.9m), compared with increases of 22.5 percent in the northern region and 10.1 percent in the eastern region. China still makes up 98.8 percent of Anta's turnover, although it achieved a sales increase of 25.9 percent to RMB 103.6 million (€12.2m-$16.4m) in other markets, mostly in Southeast Asia, the Middle East and Eastern Europe.
Apparel showed the strongest growth for the year, with sales up by 28.7 percent to RMB 4,288.4 million (€506.3-$679.9m), against a rise of 13.3 percent to RMB 4,334.8 million (€511.8m-$687.3m) for footwear and an increase of 12.5 percent for accessories.
The company's gross margin slipped by 0.5 percentage points to 42.3 percent. Its operating profit margin also declined by 0.8 percentage points to 22.6 percent, but thanks to the increased turnover the group's operating profit still jumped by 15.8 percent to RMB 2,011.5 million (€237.5m-$318.9m). Profit attributable to shareholders firmed up by 11.5 percent to RMB 1,730.1 million (€204.3m-$274.3m).
The number of Anta partner stores reached 7,778 at the end of the year, an increase of 229 units compared with the end of the previous year, and the average sales floor surface per Anta store expanded from 116 square meters to 123 square meters. At the same time, the company had 887 stores for its lifestyle range, an increase of 138 stores, as well as 632 stores for its children's range – significantly increasing its scope compared with 383 stores at the end of 2010.
At the end of last year there were also 220 stores operated by distributors and franchisees in China for the Fila brand, which Anta acquired for China in 2009, and some more operated by Anta itself in Hong Kong and Macao.
However, with the exception of children's stores, the numbers fell short of the targets set by Anta earlier, as the company reined in its retail part nerships. Anta said it focused on improving existing stores instead of rushing ahead to open more while the market was tight. The number of Anta stores even decreased by 141 to 2,602 stores in the eastern region.
This relatively cautious approach will continue this year. While Anta previously opened several hundreds of stores per year, it plans to end this year with 7,800 to 8,000 units, which would be almost unchanged at the lower end of the range. The plans call for Anta to have 800 to 900 stores for its lifestyle range and the same for its children's range at the end of the year, along with 250 to 300 stores for the Fila brand.
The Anta brand continues to build on its strength in basketball, particularly with the endorsements of NBA players Kevin Garnett and Luis Scola, who both toured China last year. Another focus in terms of sports categories and marketing is running, with campaigns highlighting Anta's footwear technologies.
Anta predicts that Chinese market conditions will remain tough this year, as some companies are still suffering from excess inventory, leading to more discounting in stores. The measures taken by the Chinese government in 2011 to push consumption are expected to be loosened this year as inflation has eased since the year-end.
The group said it concentrated on strengthening its brand last year, with ample marketing investments. Among other moves, it has teamed up with the Chinese Olympic Committee to organize events that are meant to whip up enthusiasm for the Chinese team ahead of the London Olympics. Anta will outfit the Chinese sports delegation and Chinese medalists at the London Olympics, and introduce a series of lighter A-Jelly running footwear.
