Maintain high dividend payout Profit attributable to equity holders climbed up to RMB 870 million
(22 March 2017, Hong Kong) The leading international sportswear brand enterprise in the PRC, China Dongxiang (Group) Co., Ltd. ("China Dongxiang" or "the Group"; HKEx stock code: 3818, together with its subsidiaries, "the Group") is pleased to announce its annual results for the year ended 31 December 2016 ("reporting period").
2016 Performance Highlight
- Kappa and Kappa Kids
To mark the centenary of the Kappa brand, the Group launched a full range of marketing activities through a combination of online and offline brand marketing activities. A "Kappa 100 Years" exhibition across 11 cities in China was rolled out. In YOHOOD, a gala of new products in global fashion, our classical BANDA products were displayed for fashion lovers. Elsewhere, Kappa worked with our brand ambassador G-Dragon to initiate a new topic known as #PEOPLE ON THE MOVE#, resulting in notable enhancements to our brand exposure and reputation.
The Group officially took over the operation of Kappa Kids in 2016 and marketing initiatives were rolled out steadily. Kappa Kids participated in several activities such as the Kappa Cup City Orienteering Tournament, the Feige Kid's Balance Bike Contest, as well as the first international parent-child fashion week. Kappa Kids joined the Kappa adults' wear in the Kappa Centenary Brand Exhibition, earning positive market response in the display of brand image.
As at the end of December 2016, the Group had a total of 1,563 Kappa stores (including 262 Kappa Kids stores).
The Group made vigorous efforts to introduce Phenix to the China market to capitalise on opportunities arising from China's hosting of Winter Olympics 2022. With a main focus on high-end ski centers, we sought to appeal to avid skiers by opening branded stores at the ski grounds. Phenix has opened stores in Beijing core districts including Sanlitun and Zhushikou, as well as high-end ski resorts such as Wanlong, Genting and Thaiwoo.
- E-commerce business
As China's online retail sales for 2016 climbed to a record high, the Group has also delivered good performance in its e-commerce business. Our e-commerce strategy aimed to attract new customers through more extensive consolidation of resources. We were also actively involved in the marketing activities organised by famous e-commerce platforms, such as the 11.11 Global Fashion Festival hosted by Tmall, where Kappa was one of the only 4 international sporting brands participating. As at the end of December 2016, our e-commerce revenue for the reporting period increased year-on-year by 20.1% (excluding revenue from kids' wear sales via e-commerce), with a gross profit margin of 63%.
- Investment business
A two-pronged growth driver formed by the principal sportswear business and the complementary investment business has been growing in maturity. For the reporting period, the Group reported net investment profit of RMB708 million, representing year-on-year growth of 14.0%.
Mr. Chen Yihong, Chairman, Chief Executive Officer and Executive Director of China Dongxiang (Group) Co., Ltd., said, "Step by step, we can venture afar. Through continue to build on the concerted effort among teams and more extensive consolidation of resources, our business will continue its excellent performance, and we will continue to engage challenges and opportunities with a versatile and open minded approach. In order to enhance our brand and corporate value, we will continue to seek profitable return for our shareholders."
About China Dongxiang (Group) Co., Ltd.
Chan Dongxiang (Group) Co., Ltd. (HKEx: 3818) is a leading international sportswear brand enterprise in China which has been listed on the Main Board of the Hong Kong Stock Exchange since 10 October 2007. The Group is primarily engaged in the design, development, marketing and wholesale of branded sportswear in China. Currently, China Dongxiang owns all rights to the internationally renowned Kappa brand in China, Macau and Japan. On 1 May 2008, China Dongxiang completed the acquisition of Phenix, a Japanese sportswear enterprise. Phenix is the most popular ski brand in Japan with the largest market share, as well as a well-known brand in the international market.
For enquiries, please contact:
China Dongxiang (Group) Co., Ltd.
Investor Relations Department
Christina Low, Erin Su