Topsports, the Chinese multi-banner retailer and key Nike and Adidas partner, reported a 6% decline in revenue to RMB 12.3 billion (€1.7bn) for the six months ended Aug. 31, as net income fell 10% to RMB 789.1 million (€110.5 m). Weak brick-and-mortar footfall weighed on results despite solid e-commerce performance.
Topsports’ latest half-year results reflect a challenging retail environment in China, marked by sluggish in-store traffic and shifting consumer sentiment. The company’s revenue fell 6 percent year-on-year to RMB 12,298.6 million (€1.72 bn), while net profit declined 10 percent to RMB 789.1 million (€110.5 m).
Sales from Topsports’ principal partners Nike and Adidas were down 5 percent to RMB 10,811.5 million, while sales of other brands – including Puma, Converse, Vans, The North Face, Timberland, Asics, Onitsuka Tiger, Skechers, NBA, Li-Ning, Hoka and Kailas – declined 12 percent to RMB 1,412.1 million.
Weaker traffic in physical stores was the primary drag, though stronger e-commerce sales partly offset this. Retail revenues decreased 3 percent to RMB 10.6 billion, while the smaller wholesale division dropped 20 percent to RMB 1.62 billion. Concession income slid 15 percent to RMB 62.1 million, and e-sports-related revenue dropped 40 percent to RMB 12.9 million.
Despite the downturn, Topsports continued to invest in brand partnerships and new concepts. During the period, it co-organized NBA player tours in China alongside major brand partners. It launched a “Future of Style” concept store with Adidas, designed to strengthen the Three Stripes’ localization strategy.
Gross margin narrowed slightly, down 10 basis points to 41.0 percent, supported by retail’s larger contribution but offset by more promotional e-commerce activity. SG&A expenses fell 5 percent, though the ratio rose 10 basis points to 33.2 percent of sales. Topsports also reduced its store footprint, closing the half-year with 5,020 locations, down from 6,144 at the beginning of the fiscal year.
