China’s largest sportswear maker Li Ning suffered a 3.0 percent decline in H1 operating profit to 2.40 billion yuan renminbi (€304.8m) versus RMB2.48 billion for the six months ended June 30. The net profit fell 8.0 percent to RMB1.95 billion (€247.7m). Ebit tumbled 6.7 percent to RMB2.61 billion (€331.6m) from RMB2.8 billion. Total revenues increased by 2.3 percent to RMB 14.35 billion (€1.82b) from RMB14.02 billion as gross margin for the period improved by 160 basis points to 50.4 percent from 48.8 percent.
Still, citing an uncertain economic development, Li Ning lowered its FY revenue guidance to the low single digits, with the annual profit projected to be up by low double digits. In March (insert SGIE link from the March 15 story), the group considered going private. In H2, the company will look to cultivate the sports market in China by capitalizing on the recent Paris Games and working to accelerate its business with women via new products that address both function and fashion.
In H1, the company, which operated 7,677 points-of-sales across China at period end, realized a 4.4 percent increase in footwear sales to RMB7.84 billion (€995.3m) and a 4.7 percent decline in apparel sales to RMB5.38 billion (€682.0m). Equipment/accessories revenues, meanwhile, were 30 percent higher year-over-year at nearly RMB1.13 billion (€142.9m).
