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Sportswear makers turn the corner after years of losses

Update Date：2016-1-21 16:51:55 Source：BeiJing Tannet Views：943

Adidas has expanded its retail presence to more than 8,500 stores in both big and small cities and launched retail stores in new segments for women, sportswear collections and basketball.

In the next five years, the company will continue to focus on five main drivers: football, running, women, kids and Originals. This is part of its brand strategy to strengthen key categories and lead mindshare.

Adidas said the plan will cash in on its continued growth by meeting the demands of China's burgeoning middle class "who are placing a higher emphasis on quality of life experiences and the needs of a nation with an ignited interest in sports".

Adidas's rival and global market leader Nike Inc, too, has shrugged off sluggish growth trend.

In second quarter revenue to Nov 30, Nike's China unit rose 28 percent to record $938 million.

Earlier this month, Chinese sportswear maker Li Ning Co Ltd said it expects to break even in 2015 after years of losses. This expectation itself buoyed its stock.

That would have pleased its investors, including private equity firm TPG Capital Management and Singapore's sovereign wealth fund GIC Private Ltd. Li Ning posted a loss of 781.5 million yuan in 2014.

"The board believes that the expected turnaround in operating results is principally due to an increase in both the sales revenue and gross profit of the group and a decrease in expense ratio in 2015," said Li Ning, the company's chairman, in a filing to the Hong Kong Stock Exchange.

The company attributed its improved performance to efficient operations at its directly owned stores, which turned profitable, better relationships with partners and expanding e-commerce.

Anta Sports Products Ltd, another Chinese sportswear firm, too, found glad tidings in the past couple of years, after the 2011-13 downturn kept its annual profit from surpassing the 2010 level of 1.5 billion yuan.

The article transsshipment from China Daily

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