Anta Sports reported that sales for the fourth quarter of Anta-branded product, in terms of retail value, declined in the high-single-digits compared to the same period in 2021.
Sales of Fila-branded product, on a retail basis, recorded low-teens negative growth as compared to the same period in 2021. Anta Sports has owned the rights to the Fila brand in China, Hong Kong and Macao since 2009.
Retail sales of all other branded products, Descente and Kolon Sport, recorded low-teens positive growth compared to the same period in 2021.
For the full-year, retail sales of Anta-branded product recorded low-single-digit positive growth as compared to 2021. Fila-branded products recorded low-single-digit negative growth, and all other branded products recorded 20 percent to 25 percent positive growth.
Anta said in a statement, “Throughout most of the year 2022, in strict adherence to the pandemic preventive policies and initiatives in Mainland China, the Group temporarily suspended the operation of certain brick-and-mortar stores (offline channels) in designated areas in compliance with the guidelines and requirements of local governments. Hence, the offline retail business of the Group was negatively impacted by both a significant drop in foot traffic and weakened consumer sentiment. As a result, the growth momentum for the Group’s retail sales performance was adversely affected. Nevertheless, the Group strategically enhanced its e-commerce platforms (online channels) presence to drive online sales, which partially offset the impact of the suspension of the operation of the brick-and-mortar stores.
“Meanwhile, the DTC (direct-to-consumer) model (Anta brand) and direct retail (Fila brand and all other brands) businesses of the Group recorded a higher sales contribution compared with last year. The Group also incurred more expenses related to retail operations. The Group has implemented stringent cost control measures to reduce operating expenditures in all possible areas, albeit not sufficient to fully offset the pandemic’s impact on sales under the DTC model and direct retail businesses in 2022.
“The impact of the pandemic on the business performance of the Group is ongoing; its degree varies by region and response taken to address such impact. The drops in foot traffic and consumer sentiment accelerated in the fourth quarter of 2022, as reflected in the Group’s retail sales performance. Despite such a challenging business environment, the Group’s financial position remains robust and expects to record a net operating cash inflow in 2022. However, given the continuous macro uncertainties, the Group will continue to adopt the flexible “Dynamic Management” approach in response to the market volatilities to maintain a healthy inventory level under the evolving business environment.
“Nevertheless, there has been a gradual easing of pandemic preventive measures in Mainland China alongside the promulgation of favorable policies to boost domestic consumption, and the Group believes that the fundamentals of the sports industry remain solid, while the long-term momentum is stable and positive. The Group is prepared to proactively seize the growth opportunities alongside the market recoveries and will continue to implement the “Single Focus, Multi-Brand, Globalization” strategy to maintain high-quality growth.”
Photo courtesy Anta/Fila
