Anta profit up on sporting boom

Chinese sportswear retailer reports a 25% increase in full-year revenue

Anta Sports Products Ltd, the mainland's largest sportswear retailer by market value, posted record annual profits for a third year in a row as its multi-brand strategy paid off and the company gained from the rising demand for sportswear and sporting goods in the country.

The company said revenue for the period ending Dec 31, 2017, surged 25 percent to 16.69 billion yuan ($2.65 billion), while its gross profit margin rose 1 percentage point to 49.4 percent.

Net profit for the period jumped 29.4 percent to 3.09 billion yuan.

Retail sales of Anta branded products in the fourth quarter increased by 20 to 25 percent. Other brands－excluding brands newly added to the group since Oct 1, 2016－grew 85 percent to 90 percent year-on-year.

Anta in recent years has expanded its brand portfolio including FILA, Descente, Sprandi and Kingkow, Kolon Sport and NBA.

The company has been listed in Hong Kong for 10 years. Last year marked "a year of strategic transformation for Anta from a traditional private company into an internationally competitive listed corporation with modern governance standards", said Ding Shizhong, chairman and CEO of Anta Sports.

Ding attributed the company's strong growth to their "single-focus, multi-brand, and omni-channel" strategy. "Anta will continue to tap into the global market with their international brands portfolio", he said.

Apart from existing brands, Anta will continue to seek high-end international sportswear brands with strong growth potential to meet the sportswear need of its customers and fill the gaps between different market segments.

At the same time, it will also continue to improve its product differentiation and increase market share in the running, boxing, basketball, female fitness, cross-training and skiing sports segments, said Ding.

Last year, Anta sold 60 million pairs of shoes and 80 million items of clothing at its more than 10,000 stores.

In addition to the official online flagship store, Anta has collaborated with leading e-commerce platforms, including Tmall, JD, and Vipshop. On Nov 11, the e-commerce shopping festival in China, Anta recorded 700 million yuan in sales.

Anta introduced high-speed production lines last year, which saw its daily shoe manufacturing capacity rise to 3,000 pairs.

Adam Zhang, founder of the Key-Solution sports marketing and consulting agency, said Anta has gained by pricing its products lower than international competitors such as Adidas and Nike.

By offering good value and affordable prices, Anta has mainly targeted consumers in second- to fourth-tier cities who have relatively strong spending power, said Zhang.

"With high brand awareness and good value, Anta has gained the majority of consumers in China," said Zhang.

Anta's FILA brand and Anta Kids have also achieved good results, Zhang said. "Each of Anta's acquired international brands has its own specific targeted consumer group," he said.

For example, with 1,086 stores in the country, FILA, which specializes in sports fashion, has gained awareness among Chinese high-end consumers. Descente provides high-end sportswear products for skiing, cross training and running.

Anta has also become the official sportswear partner for the Beijing 2022 Winter Olympics and Paralympic Games.