Xtep (1368) H2 2023 earnings summary

Executive summary

• Revenue rose 10.9% YoY to RMB14,346m; profit attributable to ordinary equity holders increased 11.8% to RMB1,030m.

• Mainland China business showed resilience, with professional sports and athleisure growing faster than the mass-market segment.

• Branded stores totaled 8,583 globally at 31 Dec 2023; inventories fell 21.6% to RMB1,794m.

Financial highlights

• Revenue increased 10.9% to RMB14,346m; gross profit rose 14.3% to RMB6,050m and operating profit grew 7.9% to RMB1,580m.

• Profit attributable to ordinary equity holders advanced 11.8% to RMB1,030m; basic EPS increased 11.3% to RMB0.408.

• SG&A increased 18.4% to RMB4,909m, faster than revenue growth.

• Net operating cash inflow was RMB1,255m, up 119.5% YoY.

Outlook and guidance

• Priorities include strengthening running leadership through an expanded running ecosystem and community, refining value-for-money products, and upgrading the channel network for a stronger digital experience.

• Plans include maximizing core Xtep–Saucony synergies, pursuing global market opportunities, and developing K-SWISS and Palladium in Mainland China.