Chairman's Message

Dear Shareholders,

On behalf of the Board, I am pleased to present our interim results for the six months ended 30 June 2024.

Enhancing Efficiency, Improving Quality, Advancing with Stability

Through determination and patience, even the most daunting challenges can be surmounted. Navigating the challenges and opportunities of 2024, we have remained steadfast in our strategy of “Single-focus, Multi-brand, Globalization”. Guided by our principles of “Enhancing Efficiency, Improving Quality, and Advancing with Stability”, we have demonstrated agility in the face of change, achieving steady growth and delivering commendable results that showcase our resilience and competitive edge.

Faced with market uncertainties and uncontrollable factors, we have honed our focus on the sportswear industry. Adhering to the principle of “Enhancing Efficiency”, we have adopted a flexible “Dynamic Management” strategy to reduce costs and improve efficiencies, thereby enhancing the operational efficiency of our brands. We have also strengthened our organizational resilience to carve out certainty amidst uncertainties.

“Improving Quality” is the core driving force that underpins the long-term development of our business. We are committed to innovation, staying focus on executing our goals and brand positionings, and upholding longtermism as we navigate market cycles. The synergies and complementary advantages of our multiple brands have not only enabled “High-quality Growth” but also elevated our overall competitiveness and risk capacity.

Amidst a volatile external environment, we are more committed to sustainable operations management that emphasizes “Advancing with Stability”. While reinforcing internal management and optimizing our business structure, we have also actively seized opportunities. We continued to invest in digitalization and introduced AI to drive business innovation. We nurtured core talent and explored potential regions for global business expansion in order to lay the groundwork for the Group’s medium and long-term growth.

Navigating Changing Environments with Confidence Backed by Innovation

During the financial period, the Group’s business maintained steady development, achieving faster revenue and profit growth in the industry. The Group’s revenue increased by 13.8% to RMB33.74 billion (2023 1H: RMB29.65 billion), further cementing our leading position among Chinese sportswear brands. Our overall gross profit margin rose by 0.8% points to 64.1% (2023 1H: 63.3%). With stringent cost control and enhanced operational efficiency, the overall operating profit margin maintained at 25.7% (2023 1H: 25.7%). On a consolidated basis, without the effect of share of profit or loss of an associate/ a joint venture and gain arising from equity dilution under the Amer Sports Listing, the profit attributable to shareholders increased by 17.0% to RMB6.16 billion (2023 1H: RMB5.26 billion). On a consolidated basis, with the effect of the share of profit or loss of an associate/a joint venture and gain arising from equity dilution under the Amer Sports Listing, the profit attributable to shareholders increased significantly by 62.6% to RMB7.72 billion (2023 1H: RMB4.75 billion). Amidst market complexities, the Group’s exceptional results highlighted its formidable operational capabilities.

Our Group is underpinned by a solid financial foundation with strong cash reserves and robust operating cash flow. During the financial period, net operating cash inflow of RMB8.50 billion (2023 1H: RMB10.16 billion) and free cash inflow of RMB7.62 billion (2023 1H: RMB9.52 billion) were recorded. As at 30 June 2024, the Group had an aggregate amount of cash and cash equivalents, fixed deposits held at banks with maturity over three months and pledged deposits of RMB47.83 billion (as at 31 December 2023: RMB48.52 billion).

The Group strived to share the fruits of its success with its Shareholders through sustainable dividend growth. In light of the Group’s solid performance, the Board has declared an interim dividend of HK118 cents per ordinary share (2023 1H: HK82 cents) for the six months ended 30 June 2024, increased by 43.9% year on year. Ordinary dividend payout was 50.1% (2023 1H: 45.7%) of the profit attributable to equity shareholders, without the effect of non-cash accounting gain arising from equity dilution under the Amer Sports Listing.

The Group’s “Multi-brand” strategy leverages a differentiated approach, fostering balanced development across all our brands. During the financial period, ANTA segment revenue increased by 13.5% to RMB16.08 billion (2023 1H: RMB14.17 billion), while its operating profit margin expanded to 21.8% (2023 1H: 21.0%); FILA segment revenue grew 6.8% to RMB13.06 billion (2023 1H: RMB12.23 billion), with operating profit margin slightly declining to 28.6% (2023 1H: 29.7%); revenue of all other brands surged by 41.8% to RMB4.60 billion (2023 1H: RMB3.25 billion), with operating profit margin of 29.9% (2023 1H: 30.3%), maintained at a stable level.

The successful listing of Amer Sports, Inc. on the New York Stock Exchange on 1 February 2024 stands as an inspiring milestone. As the largest shareholder of Amer Sports, Inc., we believe that Amer Sports, Inc. will make a significant contribution to the Group in the future, and further drive the Group towards achieving its “Globalization” strategy.

Tiding over Challenges and Shining a Light on Every Passion

The highly anticipated Paris 2024 Olympic Summer Games came to a perfect close. As the brand having the longest partnership with the COC, ANTA has proudly supported Chinese athletes for 16 years, and our collaboration with the IOC has spanned 5 years. During the financial period, we continued to provide high quality equipment for Chinese athletes and launched the official uniform for victory ceremonies for the Chinese Sports Delegation at the Paris 2024 Olympic Summer Games. Made from recycled fiber, the uniform representing China’s first carbon neutral official uniform to receive certification from third party, allowing our athletes to showcase Chinese culture, technology innovation, and sustainability on the global stage. Furthermore, with the ongoing expansion of the Group’s multi-brand footprint and the advancement of our “Globalization” strategy, our products have reached more sports enthusiasts around the world, gaining recognition for ANTA among global consumers. We have also made steady progress in developing opportunities for FILA, DESCENTE, and KOLON SPORT across various sectors and markets. The healthy performance of our multiple brands reinforces our confidence in both the industry’s outlook and the Group’s future growth.

Regardless of the circumstances, we consistently uphold the spirit of “Keep Moving”, aiming to become the leading multi-brand sportswear group in the world. Armed with a robust strategic focus and unwavering determination to navigate through the cycles, we remain committed to steering towards our established objectives and generating increased value for our Shareholders. On behalf of the Board, I extend my sincere gratitude to the Shareholders and partners who have accompanied us on our journey. At the same time, I wish to express my heartfelt appreciation to all stakeholders and employees who have joined hands with us on this journey.