Anta Sports Products, the leading Chinese sports brand, posted strong results for the first six months of 2016, with revenues jumping by 20.2 percent ahead of the year-ago period to 6,140 million yuan renmimbi (€815.2m-$921.4m). The company, whose holdings include the rights to the Fila brand in China, Hong Kong and Macau, said this performance was due to efforts to enhance the value of its products through a “single-focus, multi-brand and omni-channel” operational strategy, improving retail management practices within all distribution channels. In addition, it broadened its coverage of various market segments, from mass to high-end markets, from functional to fashionable sporting goods, as well as from adult to kids.
The number of Fila stores run by Anta rose from 591 at the end of 2015 to 687 at the end of the first half, and the store count should reach 700 to 750 doors by the end of this year. During the period, Anta also formed a joint venture with Descente that would allow it to seize more opportunities in the high-end sportswear market. The proposed deal is most certainly intended to take advantage of an increase in snow sports participation in China, in the run-up to the Winter Olympics that will be held in and near Beijing in 2022.
Sales in the footwear segment, which represented 46.7 percent of Anta's entire revenues, grew by 19.4 percent to RMB 2,867 million (€380.8m-$430.2m), with the gross margin inching down by 0.7 percentage points to 45.1 percent. In the apparel segment, which accounted for 49.3 percent of all revenues, sales gained 22.5 percent to RMB 3,027 million (€402.0m-$454.3m) and the gross margin jumped by 3.2 percentage points to 51.5 percent. In the accessories segment, revenues increased by 4.5 percent to RMB 249 million (€33.1m-$37.4m) and the gross margin decreased by 1.9 percentage points to 37.7 percent.
Overall, the group's gross margin was up by 1.3 percentage point, thanks in particular to the stronger contribution from the Fila business, which involves higher-margin products. On the other hand, the operating margin decreased by 0.6 percentage points to 24.2 percent, mainly due to the increase in selling and distribution expenses as a result of increased advertising and marketing expenditures and the expansion of the Fila retail operation.
For the rest of the year, the company said it will continue to implement strategies to help retailers maximize profitability and enhance store efficiency, which includes adopting the latest store layouts, renovating stores, and manage orders and in-store inventories. Anta will also continue to prioritize store efficiency and open more attractive stores in prime locations. By the end of 2016, it aims to have a total of 8,600 - 8,700 Anta stores in place, up from 8,510 Anta stores at the end of June, in addition to its Fila and Descente stores. The first Descente store was opened in August and their number is expected to reach five to ten units at the end of 2016.
