China Dongxiang lost 1,747 million yuan renminbi (€247.6m) against a profit of RMB 1,811 million for the 12 months ended March 31. Total annual revenues slipped by 2.7 percent to RMB 1,916 million (€271.6m) from RMB 1,970 million. The gross margin fell to 63.9 percent from 65.6 percent. Assets at fiscal year-end were down 22 percent to RMB 4,484 million, while liabilities were 9.6 percent higher at RMB 790 million. Group income from investments declined 19 percent year-over-year to RMB 8,490 million.
Annual revenues generated by the core Kappa brand tumbled 7.1 percent to RMB 1,656 million (€234.7m) from RMB 1,782 million. Kappa apparel sales declined 8.1 percent to RMB 1,275 million (€180.7mm); footwear dipped 5.1 percent to RMB 338 million (€47.9mm), and accessory sales rose 13.2 percent to RMB 43 million (€6.1m). Kappa kidswear sales increased 42.5 percent to RMB 171 million (€24.2m). At year-end, the number of Kappa stores, including Kappa Kids, was essentially flat at 1,375. The number of directly operated retail and distribution stores operated by subsidiaries was 619, with annual revenues of RMB 1,044 million (€147.7m).
China Dongxiang maintains a positive outlook on Chinese market growth despite persistent adverse conditions, particularly Covid-19 outbreaks. Government policies designed to increase sports and fitness participation nationwide to 38.5 percent of the overall population by 2025 are cited as one reason. Additionally, the company said current industry research suggests that the market for shoes and sportswear is forecast to grow by 3.7 percent year-over-year in 2022 to RMB 400 billion (€56.6b).
