China Lilang (1234) H1 2025 earnings summary

Executive summary

• Revenue rose 7.9% year-over-year to RMB1,727.2 million for the six months ended 30 June 2025, driven by strong online, new retail, and smart casual collections, despite a challenging macro environment and channel transformation.

• Profit attributable to equity shareholders declined 13.4% year-over-year to RMB242.5 million, with EPS at RMB20.2 cents, reflecting higher expenses and lower government grants.

• Gross profit margin improved to 50.2%, but operating profit margin narrowed to 15.1% due to increased DTC and e-commerce investments.

• Interim dividend of HK11 cents per share and special interim dividend of HK5 cents per share declared, totaling HK$191.6 million (RMB175.1 million).

• Strategic focus on DTC model, new retail, and international expansion, including the first overseas store in Malaysia and launch of MUNSINGWEAR online sales.

Financial highlights

• Gross profit increased 8.4% year-over-year to RMB867.8 million; gross margin improved by 0.2 percentage points to 50.2%.

• Operating profit fell 17.1% to RMB260.1 million, mainly due to higher expenses and lower government grants.

• Net finance income rose to RMB31.8 million, supported by higher foreign exchange gains.

• Cash and bank balances totaled RMB2,924.0 million as of 30 June 2025; fixed deposits RMB2,363.5 million.

• Inventory turnover days increased to 231, attributed to higher direct-to-retail sales.

Outlook and guidance

• Targeting at least 10% total sales growth and 20%+ new retail revenue growth for 2025.

• Plans to open 50–100 net new stores in 2025, focusing on premium shopping malls and closing underperforming locations.

• Continued DTC model expansion in key provinces and further internationalization, especially in Southeast Asia.