Peak Sport Products Co., Limited reported sales jumped 51.6% to RMB3,094.9 million ($453.3 million) in 2009. The increase was mainly due to increased demand for Peak’s products and continued expansion of its distribution network across China.

Profit attributable to shareholders for the year surged by 67.1% to approximately RMB628.3 million ($92 million). Basic and diluted earnings per share amounted to RMB36 cents. The Board of Directors recommended the payment of a final dividend of HK12 cents per ordinary share, representing a dividend payout ratio of approximately 35.3%.

Gross profit of the Group amounted to RMB1,159.7 million ($169.9 million) representing an increase of 73.7% when compared to 2008. The increase in overall gross profit margin from 32.7% in 2008 to 37.5% in 2009 was mainly due to the enhanced recognition of the Peak brand products. As a result, the Group was able to raise its gross profit margin when it launched new products.

In addition to the enhanced recognition of Peak brand products by consumers, the Chinese government’s massive stimulus package to combat the global financial crisis, continuous urbanization of the second and third- tier cities and increased awareness of health and interest in sport activities by the general public, were other important factors causing the surge in the demand for Peak’s products in 2009.

During the year, the Group added 1,027 authorized retail outlets making the number of authorized retail outlets reach 6,206 (2008: 5,179) at the end of 2009. These new retail outlets were mainly located in the second and third- tier cities.

Mr. XU Zhihua, Chief Executive Officer and Executive Director of Peak Sport, said, “We are very satisfied with our achievements in this year notably the listing of the company’s shares on the Stock Exchange on 29 September 2009 and the company’s impressive results for the year ended 31 December 2009.”

“Going forward, the Group is determined to reinforce its leading position in the basketball segment through more sponsorships and marketing arrangements with NBA teams and players, as well as other NBA- related resources,” said Xu. “By leveraging its success in the basketball footwear market, the Group will launch more marketing and promotional campaigns in other sport areas, such as those of tennis, football and running in 2010. Regarding its distribution network, the Group will add approximately 1,000 retail outlets and launch 100 basketball specialty retail outlets in 2010. The Group will also expand its retail network strategically in the first-tier cities to further enhance and strengthen its brand image. With our compelling and powerful brand, extensive distribution network and strong financial support, we believe that we are well-prepared to capture the rapid growing sport products market in the coming years.”

Financial Highlights (For the year ended 31 December)
                                       2009           2008       Changes
                                    (RMB mn)       (RMB mn)
    Turnover                        3,094.9        2,042.0         +51.6%
    Gross profit                    1,159.7          667.8         +73.7%
    Gross profit margin                37.5%          32.7%       +4.8 pt
    Profit for attributable to
     equity shareholders              628.3          376.0         +67.1%
    Net profit margin                  20.3%          18.4%       +1.9 pt
    Basic & Diluted earnings
     per share (RMB)               36 cents       25 cents         +44.0%
    Final dividend per share
    (HKD)                          12 cents        9 cents            —