After raising $1.01 billion in an initial public offering on the Hong Kong stock exchange last month, Topsports International Holdings, the sports retailing arm of Belle International, published strong results for the six months ended on Aug. 31.
Sales rose by 12.4 percent as compared to the year-ago period to 16,957.6 million yuan renminbi (€2,175m-$2,420m). Nike and Adidas represented 87.9 percent of total revenues, with the rest coming from other brands such as Puma, The North Face, Vans, Skechers, Reebok and Asics. The gross margin gained 0.9 percentage points to 43.7 percent, and the retailer’s net income rose by 18.5 percent to RMB 1,470.9 million (€188.6m-$209.9 mm).
With more than 8,000 stores, the company claims to be the largest sporting goods retailer in China, with an estimated 15.9 percent share of the market.
Topsports said it is approaching the end of its program to get rid of under-performing stores. The proportion of the turnover generated by stores under 150 square meters has declined to 70.0 percent from 77.8 percent since 2017. The ratios have risen to 23.5 percent from 19.6 for the company’s stores measuring 150 to 300 square meters, and to 6.5 percent from 2.6 percent for larger stores.
The company added that its loyalty program now has 21.2 million members, up from 11.9 million in November 2018, and these members accounted for 81.4 percent of total sales for the first half of its financial year.
After its listing on Oct. 10, Topsports’ share price has gone up and down. After hitting a peak of 10.50 Hong Kong dollars eight days later, it has eased down and is now trading below HK$ 9, giving it a market capitalization of HK 54 billion (€6.3bn-$6.9bn).
