Topsports International (6110) H2 2025 earnings summary

Executive summary

• Revenue declined 6.6% year-over-year to RMB 27.01 billion due to weak consumer demand and lower offline footfall, partially offset by double-digit online sales growth.

• Net profit fell 41.9% year-over-year to RMB 1,284.7 million, with net profit margin dropping to 4.8%.

• Gross profit margin decreased by 3.4 percentage points to 38.4%, mainly due to deeper discounting and inventory provisions.

• Maintained strong free cash flow, robust working capital, and a net cash position, supporting a 135% dividend payout ratio.

• Deepened partnerships with over 20 brands, expanded exclusive operational roles, and leveraged technology for retail innovation.

Financial highlights

• Revenue: RMB 27.01 billion (down 6.6% year-over-year); net profit: RMB 1,284.7 million (down 41.9%); operating profit: RMB 1,592.7 million (down 42.8%).

• Gross profit: RMB 10.38 billion (down 14.1%); gross margin: 38.4%.

• Free cash flow increased 24.1% to RMB 3.38 billion, 2.6 times net profit.

• Cash and cash equivalents rose 32.3% to RMB 2,587.4 million.

• Total annual dividend was RMB 0.28 per share, with a payout ratio of 135%.

Outlook and guidance

• Cautious but optimistic outlook, prioritizing efficiency, profit, and omni-channel innovation over revenue growth.

• Targeting flat net profit growth and improved net profit rate, with continued focus on cost initiatives and cash flow improvement.

• Effective tax rate expected to rise to low 20s in the next two to three years.

• Continued emphasis on ESG and sustainable development.