Li Ning reported profits on an adjusted basis improved 34 percent in the year ended December 31 as revenues gained 4.2 percent.

Financial Highlights

  • Net profit attributable to equity holders increased by approximately 13.3 percent and the net profit margin raised from 10.8 percent to 11.7 percent;
  • On a comparative basis (excluding the one-off profit and loss not related to operation for the corresponding period last year), the net profit attributable to equity holders increased by approximately 34.2 percent to ¥1,698 million, and the net profit margin raised from 9.1 percent to 11.7 percent;
  • Revenue increased by approximately 4.2 percent to ¥14,457 million;
  • Gross profit margin maintained flat to last year;
  • The operating leverage has been enhanced continuously, while the operating profit margin has been driven to 15.2 percent and increased by 410 basis points;
  • Operating cash flow decreased by 21.1 percent, yet still achieved the positive amount of ¥2,763 million;
  • Gross average working capital improved (reduced) by 11 percent while revenue increased by approximately 4.2 percent
  • Cash conversion cycle further improved (shortened) by 6 days (2019: 26 days/2020: 20 days); and
  • The Board has recommended payment of a final dividend of ¥20.46 cents per ordinary share of the company issued or to be issued upon conversion of convertible securities for the year ended 31 December 2020 (2019: ¥15.47 cents).

Operational Highlights

  • Continued operation improvement mitigated a certain extent of the negative impact from the COVID-19;
  • The retail sell-through for the overall platform recorded a low-single-digit increase, including online and offline channels;
  • Channel inventory recorded a mid-single-digit increase, while company inventory decreased mid-single-digits;
  • Offline channel new product sell-through, down low-single-digit, is driven by sales volume decline;
  • Average selling price (ASP) registered a mid-single-digit increase notwithstanding a promotional retail environment; and
  • Sell-out rate: 6-month declined over 4 percentage points, 3-month declined approximately 1 percentage points.

More details are available here.

Photo courtesy Li Ning