Investment Rating - Maintain "Overweight" rating with a current price of HKD 5.49 [1] Core Views - The company achieved a 6.9% YoY increase in revenue and a 20.5% YoY increase in net profit attributable to shareholders in FY2024, with a dividend payout ratio of 100.9% [2] - The company's profit growth outpaced revenue growth due to a slight increase in gross margin and a decrease in expense ratio [2] - The company continues to expand its brand portfolio and enhance its omnichannel retail capabilities, with a focus on improving operational efficiency and user engagement [5] Financial Performance Revenue and Profit - FY2024 revenue reached RMB 28.933 billion, up 6.9% YoY, while net profit attributable to shareholders was RMB 2.213 billion, up 20.5% YoY [2] - EPS for FY2024 was RMB 0.36, with a final dividend of RMB 0.05 per share and a special dividend of RMB 0.15 per share, combined with an interim dividend of RMB 0.16 per share [2] - Gross margin increased by 0.1 percentage points (PCT) to 41.8%, operating margin rose by 0.6 PCT to 9.6%, and net margin attributable to shareholders increased by 0.8 PCT to 7.6% [2] Segment Performance - Revenue from core brands (Nike + Adidas) grew by 6.5% YoY, while revenue from other brands increased by 10.5% YoY [2] - Retail channel revenue grew by 8.9% YoY, while wholesale channel revenue declined by 3.3% YoY [2] - The number of directly operated stores decreased by 6.4% YoY to 6,144, but average store size increased by 6.0% [3] Operational Efficiency - Inventory turnover days decreased by 13 days to 136 days, while accounts receivable turnover days increased by 1 day to 15 days [3] - Operating cash flow decreased by 28.1% YoY to RMB 3.129 billion [3] Brand and Channel Strategy - The company has expanded its brand portfolio by partnering with HOKA, Kailas, and norda, and has initiated a collaboration with Fanatics for IP commercialization in Greater China [5] - Online sales accounted for 20-30% of total direct sales, with live-streaming sales increasing approximately 5x YoY [5] - The company has 76.3 million cumulative users as of February 2024, with a 12.4% YoY increase in user count and high single-digit growth in per-user value [5] Future Outlook - The company is expected to maintain steady growth through brand diversification and omnichannel retail capabilities, with a high dividend payout ratio averaging 7.5% over the past three fiscal years [6] - FY2025-2027 EPS forecasts are adjusted to RMB 0.39, RMB 0.43, and RMB 0.47, respectively, with PE ratios of 13x and 12x for FY2025 and FY2026 [6]

Financial Performance - Total revenue for the year ended February 29, 2024, was RMB 28,933.2 million, an increase of 6.9% from RMB 27,073.2 million in the previous year[3]. - Gross profit for the same period was RMB 12,080.8 million, up from RMB 11,284.2 million, resulting in a gross margin of 41.8% compared to 41.7%[3]. - Operating profit increased to RMB 2,786.5 million, representing a growth of 14.7% from RMB 2,430.9 million, with an operating margin of 9.6%[3]. - Profit attributable to equity holders of the company rose to RMB 2,213.0 million, a 20.5% increase from RMB 1,836.6 million, leading to an earnings per share of RMB 35.69, up from RMB 29.62[4]. - The cost of goods sold amounted to RMB 16,816.2 million, up 6.6% from RMB 15,773.2 million in the prior year[23]. - Total income tax expense for the year ended February 29, 2024, was RMB 547.9 million, compared to RMB 485.8 million for the previous year, indicating an increase of approximately 12.8%[8]. - Basic earnings per share rose to RMB 35.69 for the year ended February 29, 2024, up from RMB 29.62 in the previous year, reflecting an increase of about 20.5%[28]. - Profit attributable to equity holders increased by 20.5% year-on-year to RMB 2,213.0 million, with a profit margin improvement of 0.8 percentage points to 7.6%[42]. Dividends and Shareholder Returns - The company declared a total dividend of RMB 36.00 cents per share, including a special dividend of RMB 15.00 cents, consistent with the previous year[3]. - The company plans to distribute a total dividend of RMB 0.36 per share for the fiscal year ending February 29, 2024, with a payout ratio of 100.9%[45]. - The board of directors proposed a final dividend of RMB 0.05 per share, totaling RMB 310.1 million, consistent with the previous year[91]. - A special dividend of RMB 0.15 per share was also proposed, amounting to RMB 930.2 million, unchanged from the prior year[91]. - The actual exchange rate for dividends paid in HKD is RMB 1.00 = HKD 1.0648, resulting in a final dividend of HKD 0.0532 and a special dividend of HKD 0.1597 per share[91]. Cash Flow and Financial Position - The company's operating cash flow for the year ended February 29, 2024, was RMB 3,729.4 million, a decrease of 29% from RMB 5,241.5 million for the year ended February 28, 2023[11]. - Net cash position maintained, with no significant debt, reflecting a strong balance sheet[3]. - The company reported a net financing cash outflow of RMB 3,332.3 million, slightly improved from RMB 3,440.3 million in the previous year[11]. - The company's cash and cash equivalents at the end of the year were RMB 1,956.0 million, down from RMB 2,357.4 million at the end of the previous year[11]. - As of February 29, 2024, the company maintained a net cash position of RMB 1,362.0 million, down from RMB 2,098.4 million in 2023[85]. Inventory and Asset Management - Inventory turnover period decreased to 136.1 days from 149.5 days, reflecting improved inventory management[3]. - The company's inventory as of February 29, 2024, was RMB 6,283.8 million, slightly up from RMB 6,247.3 million as of February 28, 2023, showing a growth of about 0.6%[31]. - Total assets decreased to RMB 14,544.0 million from RMB 16,820.7 million, primarily due to a reduction in cash and cash equivalents[7]. - Total liabilities decreased to RMB 4,693.6 million from RMB 6,987.1 million, indicating a reduction in financial obligations[9]. - The company's cost of inventory was RMB 16,816.2 million for the year ended February 29, 2024, compared to RMB 15,773.2 million for the previous year, indicating an increase of approximately 6.6%[31]. Market and Operational Strategy - The company plans to continue expanding its market presence in China, focusing on enhancing product offerings and operational efficiency[13]. - The company aims to expand its outdoor sports industry scale to RMB 3 trillion by 2025, supported by government policies[37]. - The company focuses on a consumer-centric, multi-brand, and multi-category retail operation platform to enhance market responsiveness[43]. - The company emphasizes the importance of maintaining supply-demand balance and expanding offerings in a fluctuating consumer environment[39]. - The company established retail partnerships with international brands such as HOKA ONE ONE and KAILAS to enhance product offerings and services[40]. Employee and Training Initiatives - Employee costs increased to RMB 2,931.1 million, a rise of 1.4% from RMB 2,890.5 million in the previous year[23]. - The total number of employees decreased by 4.9% year-on-year to 29,458, reflecting a narrowing decline in line with the overall recovery trend in the retail environment[60]. - The company upgraded its "Bo Academy" learning platform and conducted nearly 200 offline training sessions, achieving a training coverage rate of over 95% for employees[61]. Sustainability and Governance - The MSCI ESG rating for the company is BBB, positioning it at a leading level among listed companies in the Chinese sports footwear and apparel industry[62]. - The company aims to create long-term value for consumers, shareholders, partners, and society by adhering to sustainable development principles and responding to new market demands[64]. - The company has established sustainability goals, with over 70% of brand partners setting carbon targets and over 50% committing to carbon neutrality[66]. - The company continues to enhance its governance framework, receiving multiple awards for best management and ESG practices in Asia[66]. Digital and User Engagement - The user base has grown from 10.2 million in August 2018 to over 70 million, indicating significant user accumulation[53]. - The company launched the "Douyin Membership Pass" system, leading to a notable increase in new members on the Douyin platform[55]. - Membership contribution to in-store retail sales (including VAT) was 93.4% for the fiscal year, demonstrating a stable sales contribution despite fluctuations in the consumer environment[56]. - The average spending per high-value member continues to significantly exceed that of overall members, with high-value members contributing nearly 40% to total sales despite only representing a low single-digit percentage of total spending members[56]. - The company has connected with users through over 80,000 corporate WeChat groups, enhancing user interaction and engagement[50].

%% research.95579.com %% ...

浦银国际研究 公司研究 | 消费行业 滔搏（6110.HK）：低估值、高股息、 林闻嘉 优质基本面带来较强的防御性 浦 首席消费分析师 银 richard_lin@spdbi.com 国 我们认为滔搏短期较弱的收入表现已基本反映在股价中，同时认为公 (852) 2808 6433 司当前较低的估值水平与较高的股息率，叠加其优秀的基本面和现金 际 桑若楠，CFA 流，为滔搏的股价提供了很强的防御性，可支撑滔搏后市维持稳健的 股价表现。下调滔搏目标价至 7.0 港元，维持滔搏“买入”评级。 消费分析师 serena_sang@spdbi.com  当前股价已反映 2024年以来较弱的收入趋势：基于疲弱的终端需求 (852) 2808 6439 公 以及较高的基数，我们预计滔搏 1-2 月收入同比小幅下滑低单位数， 司 2024年4月12日 与行业表现基本一致。结合 2023 年 12 月在低基数之上较高速的收 研 入增长，我们预测滔搏 4QFY24 整体收入同比增长中单位数。我们预 评级 究 计滔搏 3 月的收入延续了1-2 月小幅下跌的趋势，但跌幅远小于主要 同业（宝胜）。公司库存依然维持健康水平，2 月底库 ...

Investment Rating - The investment rating for the company is "Buy" (maintained) [1][62]. Core Views - The report emphasizes that the low valuation of the company is due to market misconceptions about retail distributors, which are seen as lacking brand ownership and pricing power. However, the company possesses operational efficiency and a strong retail management capability, making it a valuable partner for international brands [4][12]. - The company is expected to benefit from the recovery of international brands in the Greater China region and the introduction of new brands, which will support a new round of store expansions [5][50]. Summary by Sections Financial Performance - The company's projected net profits for FY2024-2026 are 2.29 billion, 2.61 billion, and 2.91 billion CNY respectively, with corresponding EPS of 0.4, 0.4, and 0.5 CNY. The current stock price corresponds to PE ratios of 13.0, 11.3, and 10.0 times [4][62]. - The revenue for FY2024 is expected to be 29.58 billion CNY, showing a year-on-year growth of 9.3% [7][62]. Market Position and Growth Potential - The company is positioned to enhance its market share due to its efficient retail operations and the ongoing recovery of international brands, particularly Adidas, which is expected to exceed expectations in terms of growth [6][50]. - The report highlights that the company's average monthly store efficiency is leading compared to peers, and its digital management capabilities are expected to further enhance operational efficiency [5][39]. Competitive Landscape - The retail industry is shifting from scale expansion to quality improvement, with the company leveraging its digital and refined management to maintain a competitive edge [5][12]. - The report notes that the competitive landscape is becoming increasingly concentrated, with larger retailers gaining more market share, particularly in first to fourth-tier cities [5][44]. Operational Efficiency - The company has demonstrated resilience during the pandemic, with its revenue recovery outperforming competitors. The report indicates that the company's gross margin has remained stable, supported by effective inventory and discount management [11][27]. - The operational metrics show improvements in inventory turnover and cash flow efficiency, which are expected to enhance the company's return on equity (ROE) in the medium term [58][61]. Future Outlook - The company is expected to continue expanding its store network while focusing on improving efficiency rather than merely increasing the number of stores. The report anticipates a gradual return to expansion in FY2024, with a focus on enhancing store performance metrics [56][62]. - The introduction of new brands and the ongoing recovery of existing brands are projected to create additional growth opportunities for the company [55][62].

Financial Performance - Revenue for the six months ended August 31, 2023, reached RMB 14,176.5 million, a 7.3% increase from RMB 13,218.0 million in 2022[4] - Gross profit for the same period was RMB 6,340.8 million, with a gross margin of 44.7%, down from 45.6% in the previous year[4] - Operating profit increased to RMB 1,725.9 million, representing an operating margin of 12.2%, compared to 12.0% in 2022[4] - Profit attributable to equity holders rose to RMB 1,337.2 million, with a profit margin of 9.4%, up from 8.7% in the prior year[4] - Basic and diluted earnings per share increased to RMB 21.56, compared to RMB 18.47 in the previous year[4] - Revenue for the first half of the fiscal year 2023/24 increased by 7.3% year-on-year to RMB 14,176.5 million[11] - Retail business revenue grew by 8.8% year-on-year to RMB 11,987.7 million, driven by demand recovery and marketing activities[11] - Core operating profit (excluding other income) rose by 22.9% year-on-year to RMB 1,679.7 million, with a core operating profit margin of 11.8%[12] - Profit attributable to equity holders increased by 16.7% year-on-year to RMB 1,337.2 million, with a profit margin of 9.4%[12] - Cash generated from operating activities increased by 57.8% year-on-year to RMB 2,550.8 million, 1.9 times the profit attributable to equity holders[17] Inventory and Receivables Management - Inventory decreased by 10.1% compared to August 31, 2022, and the average inventory turnover period decreased by 26.7 days to 140.9 days[17] - The average trade receivables turnover period improved to 14.8 days from 16.4 days in 2022[4] - Trade receivables increased to RMB 1,230.6 million as of August 31, 2023, up 15.9% from RMB 1,061.2 million as of February 28, 2023[132] Store Operations - The number of stores decreased by 10.4% year-on-year to 6,209, while total sales area decreased by 3.5%[18] - Same-store sales growth was driven by improved new product sales, contributing to a healthier retail environment[11] - Rental cost ratio decreased by 0.5 percentage points to 13.3% due to improved store efficiency[19] Employee and Cost Management - Total employee count decreased by 8.7% year-on-year to 29,896, with a quarter-on-quarter decline of 3.5%[25] - The employee cost ratio decreased by 1.3 percentage points year-on-year to 10.0%, despite an increase in average employee costs[25] - Total employee costs for the six months ended August 31, 2023, amounted to RMB 1,413.4 million, accounting for 10.0% of total revenue, down from 11.3% in the previous year[66] Cash and Financial Health - The company reported significant growth in bank balances and cash compared to the previous year, indicating improved financial health[9] - As of August 31, 2023, the company held cash and cash equivalents totaling RMB 3,394.2 million, resulting in a net cash position of RMB 2,554.2 million after deducting short-term borrowings[58] - Cash generated from operating activities increased to RMB 2,680.7 million, up from RMB 2,133.7 million, reflecting a growth of 25.7%[93] - The company's total liabilities decreased to RMB 5,528.9 million from RMB 6,987.1 million, a reduction of approximately 21%[86] Strategic Initiatives - The company expanded its brand collaboration matrix, including partnerships with "HOKA ONE ONE" and "Kailas" to enhance product offerings[9] - Investment was made in professional ski equipment retailer "Cold Mountain" and outdoor content organization "Mounster" to diversify product categories[9] - The company is focusing on innovative business models and services to cater to the interests of the younger consumer demographic[31] - Future strategies include focusing on user engagement, global retail, and innovative business models to ensure long-term growth[40] Market Environment - The overall economic environment in China showed a GDP growth of 5.5% in the first half of 2023, supporting consumer demand recovery[7] - The overall consumption environment is recovering, and the company remains optimistic about future market demand[38] Corporate Governance - The company has adopted the corporate governance code as its own governance practices and has complied with all applicable code provisions except for one[150] - The audit committee, consisting of three independent non-executive directors, has reviewed the financial reporting procedures and internal control systems, discussing the interim financial data for the six months ending August 31, 2023[154] Dividends and Shareholder Information - The interim dividend declared is RMB 0.16 per share, with a payout ratio of 74.2%, up from 70.4% in the previous year[17] - The company declared an interim dividend of RMB 0.16 per share for the year ending February 29, 2024, totaling RMB 992.2 million[125] - The major shareholder HHBH Investment, L.P. holds 34.89% of the company's shares, totaling 2,163,605,107 shares[145]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完整性亦不發表任何聲明，並明確表示， 概不對因本公告全部或任何部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 TOPSPORTS INTERNATIONAL HOLDINGS LIMITED 滔搏國際控股有限公司 (於開曼群島註冊成立的有限公司) (股份代號：6110) 截至 2023年 8月 31日止六個月 中期業績公告 財務摘要 未經審核 截至8月31日止六個月 2023年 2022年 收入 人民幣百萬元 14,176.5 13,218.0 毛利 人民幣百萬元 6,340.8 6,030.7 經營利潤 人民幣百萬元 1,725.9 1,580.5 本公司權益持有人應佔利潤 人民幣百萬元 1,337.2 1,145.4 毛利率 % 44.7 45.6 經營利潤率 % 12.2 12.0 本公司權益持有人應佔利潤率 % 9.4 8.7 每股盈利－基本及攤薄 人民幣分 21.56 18.47 每股股息 - 中期 人民幣分 16.00 13.00 ...

Financial Performance - Revenue for the year ended February 28, 2023, was RMB 27,073.2 million, a decrease of 15.5% from RMB 31,876.5 million in 2022[6] - Gross profit for the same period was RMB 11,284.2 million, down 18.4% from RMB 13,824.4 million, resulting in a gross margin of 41.7% compared to 43.4% in the previous year[6] - Operating profit decreased to RMB 2,430.9 million, a decline of 29.2% from RMB 3,430.1 million, leading to an operating profit margin of 9.0%[6] - Profit attributable to equity holders was RMB 1,836.6 million, down 25.0% from RMB 2,446.5 million, with a profit margin of 6.8%[6] - Basic and diluted earnings per share were RMB 29.62, down from RMB 39.45 in the previous year[6] - Total revenue decreased by 15.1% year-on-year to RMB 27,073.2 million[11] - The group’s revenue decreased by 15.1% from RMB 31,876.5 million for the year ended February 28, 2022, to RMB 27,073.2 million for the year ended February 28, 2023[38] - Revenue from the main brands (Nike and Adidas) was RMB 23,324.0 million, accounting for 86.2% of total revenue, down 15.4% from RMB 27,569.3 million in the previous year[38] - The group's operating profit fell by 29.1% to RMB 2,430.9 million for the year ended February 28, 2023, while profit attributable to equity holders decreased by 24.9% to RMB 1,836.6 million[42] - Gross profit declined by 18.4% to RMB 11,284.2 million, with a gross margin of 41.7%, down from 43.4% in the previous year[43][44] Cash Flow and Liquidity - Free cash flow reached RMB 3,995.5 million, demonstrating strong cash generation capabilities[12] - The company generated a net cash inflow from operating activities of RMB 4,350.7 million, with free cash flow reaching RMB 3,995.5 million[30] - As of February 28, 2023, the company's bank balance and cash amounted to RMB 2,357.4 million, a year-on-year increase of 34.5%[30] - The net cash generated from operations decreased from RMB 6,592.3 million for the year ended February 28, 2022, to RMB 5,241.5 million for the year ended February 28, 2023, a reduction of RMB 1,350.8 million[52] - The net cash used in investing activities was RMB 305.6 million for the year ended February 28, 2023, compared to RMB 671.3 million in the previous year[52] - The net cash used in financing activities was RMB 3,440.3 million for the year ended February 28, 2023, down from RMB 4,494.4 million in 2022[53] Inventory and Receivables Management - The average trade receivables turnover period improved to 14.6 days from 18.8 days, while the average inventory turnover period increased to 149.5 days from 130.4 days[6] - Inventory amount decreased by 6.6% year-on-year, and cash and bank balances increased by 34.5% to RMB 2,357.4 million[12] - The company aims to optimize inventory structure and maintain inventory efficiency as a top priority[11] - Inventory value decreased by 6.6% compared to February 28, 2022, and by 2.4% compared to August 31, 2022, aligning with changes in total sales area[24] Store Operations and Network - As of February 28, 2023, the company operated 6,565 directly operated stores, a year-on-year decrease of 14.7%, with total sales area down 6.8%[22] - The average sales area per store increased by 9.2% year-on-year, indicating improved efficiency in store operations despite a reduction in total store count[22] - The company closed 1,559 stores during the fiscal year, while opening only 429 new stores, resulting in a net decrease of 1,130 stores[24] - The company focused on optimizing its store network, leading to a significant advantage in store efficiency metrics for newly opened stores compared to closed ones[22] Strategic Initiatives and Future Outlook - The company plans to optimize its physical store network and enhance online presence to adapt to changing consumer behaviors[8][9] - The company remains confident in the long-term growth potential of the sports footwear and apparel industry despite current market challenges[9] - The company aims to improve operational efficiency by refining its retail capabilities and optimizing organizational structure[9] - The company is optimistic about the recovery of the sports footwear and apparel industry, citing strong demand potential[13] - Future strategies include refining user operations and transitioning from traffic-focused to user value-oriented thinking[36] - The company is expanding its market presence in Southeast Asia, targeting a 25% market share by 2025[135] Shareholder and Corporate Governance - The board proposed a total dividend of RMB 0.33 per share, with a payout ratio of 111.4%[12] - The board consists of two executive directors, four non-executive directors, and three independent non-executive directors as of February 28, 2023[145] - The company has adopted the corporate governance code as its own governance code, ensuring compliance with the updated regulations effective from January 1, 2022[144] - The company has established three board committees: audit committee, remuneration committee, and nomination committee to oversee various aspects of governance[145] - The company has mechanisms in place to ensure the board receives independent opinions and advice[155] - The company has implemented a shareholder communication policy to facilitate active engagement and ensure shareholders can exercise their rights with full information[196] Employee and Social Responsibility - The total employee cost for the year ended February 28, 2023, was RMB 2,890.5 million, accounting for 10.7% of the group's revenue, compared to 10.9% in the previous year[61] - The company employed a total of 30,978 staff as of February 28, 2023, down from 40,913 in the previous year[61] - The company is committed to actively practicing corporate social responsibility and building long-term sustainable development[36] - The board of directors emphasized the importance of sustainability initiatives, aiming for a 50% reduction in carbon footprint by 2030[134] Risk Management and Compliance - The board is responsible for establishing and reviewing the effectiveness of the risk management and internal control systems[178] - The group has identified significant risks affecting its strategic objectives, considering environmental, social, and governance (ESG) factors in its annual risk assessment[179] - The internal audit department has been established to review operational, financial, compliance, and risk management controls, identifying deficiencies and suggesting improvements[180] - The board conducted a comprehensive review of the risk management and internal control systems for the fiscal year ending February 28, 2023, and deemed them effective and sufficient[182]

Financial Performance - Total revenue for the year ended February 28, 2023, was RMB 27,073.2 million, a decrease of 15.5% from RMB 31,876.5 million in the previous year[2]. - Gross profit for the same period was RMB 11,284.2 million, down 18.4% from RMB 13,824.4 million, resulting in a gross margin of 41.7% compared to 43.4%[2][4]. - Operating profit decreased to RMB 2,430.9 million, representing a decline of 29.2% from RMB 3,430.1 million, with an operating margin of 9.0% compared to 10.8%[2][4]. - Profit attributable to equity holders was RMB 1,836.6 million, down 25.0% from RMB 2,446.5 million, leading to a basic and diluted earnings per share of RMB 29.62, down from RMB 39.45[2][4]. - Sales of goods decreased to RMB 26,844.3 million, down 15.0% from RMB 31,574.5 million in the previous year[16]. - Basic earnings per share decreased to RMB 29.62 for the year ended February 28, 2023, down from RMB 39.45 in the previous year, representing a decline of about 25%[22]. Dividends - The company proposed a final dividend of RMB 5.00 per share, down from RMB 7.00, with total dividends for the year amounting to RMB 15.00 compared to RMB 23.00 in the previous year[2]. - The company has proposed a final dividend of RMB 5.00 per share and a special dividend of RMB 15.00 per share for the year ended February 28, 2023, totaling RMB 1,240.3 million[23]. - The total dividend for the fiscal year was RMB 0.33 per share, with a payout ratio of 111.4%[42]. Cash Flow and Liquidity - The net cash generated from operating activities for the year ended February 28, 2023, was RMB 5,241.5 million, a decrease of 20.5% from RMB 6,592.3 million in the previous year[8]. - The net cash used in investing activities was RMB 305.6 million, significantly improved from RMB 671.3 million in the previous year, indicating a reduction of 54.5%[8]. - The net cash used in financing activities was RMB 3,440.3 million, a decrease of 23.5% compared to RMB 4,494.4 million in the previous year[8]. - The company reported a net increase in cash and cash equivalents of RMB 604.8 million for the year, compared to an increase of RMB 523.8 million in the previous year[8]. - The cash and cash equivalents at the end of the year were RMB 2,357.4 million, up from RMB 1,752.6 million at the beginning of the year[8]. - As of February 28, 2023, the group held cash and cash equivalents totaling RMB 3,643.4 million, resulting in a net cash position of RMB 2,098.4 million after deducting short-term borrowings of RMB 1,545.0 million[59]. Assets and Liabilities - Total assets as of February 28, 2023, were RMB 16,820.7 million, a decrease from RMB 17,796.3 million in the previous year[6]. - Total liabilities decreased to RMB 6,987.1 million from RMB 7,214.8 million, resulting in a net asset value of RMB 9,833.6 million compared to RMB 10,581.5 million[7]. - The company maintained a current ratio of 2.3, consistent with the previous year[2]. - Trade receivables amounted to RMB 1,054.9 million as of February 28, 2023, compared to RMB 1,106.9 million as of February 28, 2022, showing a decrease of approximately 4.7%[25]. - As of February 28, 2023, accounts payable amounted to RMB 991.0 million, an increase from RMB 926.7 million on February 28, 2022, reflecting a growth of 6.9%[27]. - Short-term bank loans totaled RMB 1,545.0 million as of February 28, 2023, compared to RMB 518.2 million on February 28, 2022, indicating a significant increase of 197.5%[28][29]. Operational Efficiency - Average trade receivables turnover period improved to 14.6 days from 18.8 days, while average inventory turnover period increased to 149.5 days from 130.4 days[2]. - The company reported a foreign exchange gain of RMB 82.1 million, compared to a loss of RMB 20.5 million in the previous year[5]. - The company reported a total of RMB 24,942.3 million in total expenses for sales costs, selling and distribution expenses, and general and administrative expenses for the year ended February 28, 2023, down from RMB 28,783.9 million in 2022, a reduction of about 13.4%[18]. - Employee costs decreased to RMB 2,890.5 million in 2023 from RMB 3,463.7 million in 2022, reflecting a reduction of about 16.5%[18]. - Total financing costs netted to RMB (108.5) million for the year ended February 28, 2023, compared to RMB (104.0) million for the previous year, indicating a slight increase in financing costs[19]. Market and Strategic Initiatives - The retail environment remains challenging due to the impact of COVID-19 and inflationary pressures, yet the company is committed to adapting its strategies to maintain consumer engagement[30]. - The company has implemented a strategy to optimize its store network, closing underperforming stores while cautiously opening new ones, aiming to enhance overall operational efficiency[34]. - Online private domain sales showed the most significant year-on-year growth, reflecting a shift in consumer purchasing behavior towards digital platforms[32]. - The overall retail market is experiencing a polarization in demand, with a growing preference for both mass-market and niche high-end sports products[30]. - The company aims to actively pursue sustainable development and corporate social responsibility initiatives as part of its long-term strategy[43]. Employee and Governance - The group employed a total of 30,978 employees as of February 28, 2023, down from 40,913 employees in 2022[62]. - The remuneration committee is responsible for establishing transparent compensation policies for directors and senior management[69]. - The nomination committee evaluates board performance and recommends suitable candidates for directorship[70]. - The audit committee reviewed the consolidated financial statements for the year ended February 28, 2023[67]. - The external auditor confirmed that the preliminary performance announcement aligns with the audited financial statements for the year ended February 28, 2023[68].

Financial Performance - Revenue for the six months ended August 31, 2022, was RMB 13,218.0 million, a decrease of 15.2% from RMB 15,573.4 million in 2021[5] - Gross profit was RMB 6,030.7 million, down from RMB 6,923.5 million, resulting in a gross margin of 45.6%, compared to 44.5% in the previous year[5] - Operating profit decreased to RMB 1,580.5 million, with an operating margin of 12.0%, down from 13.2% in the prior year[5] - Profit attributable to equity holders was RMB 1,145.4 million, a decline from RMB 1,430.8 million, leading to a profit margin of 8.7% compared to 9.2%[5] - Basic and diluted earnings per share were RMB 18.47, down from RMB 23.07 in the previous year[5] - Total revenue for the first half of the fiscal year ending February 28, 2023, decreased by 15.1% year-on-year to RMB 13,218.0 million[11] - Profit attributable to equity holders decreased by 19.9% to RMB 1,145.4 million for the six months ended August 31, 2022, down from RMB 1,432.0 million in the same period last year[27] - Basic earnings per share fell by 19.9% to RMB 18.47 from RMB 23.07 in the same period last year[33] - The total comprehensive income for the period was RMB 1,174.5 million, with a profit of RMB 1,145.4 million contributing to this figure[56] Operational Efficiency - The average trade receivables turnover period improved to 16.4 days from 19.4 days, while the average payables turnover period also improved to 16.4 days from 21.2 days[5] - The average inventory turnover period increased to 167.6 days, compared to 147.8 days in the previous year[5] - Inventory as of August 31, 2022, decreased by 16.6% compared to August 31, 2021, and by 4.2% compared to February 28, 2022, indicating effective inventory management[11] - Selling and distribution expenses were RMB 4,090.8 million, accounting for 30.9% of revenue, up from 29.2% in the prior year[30] - General and administrative expenses decreased to RMB 574.3 million, representing 4.3% of revenue, compared to 4.1% in the previous year[30] Market Environment - The retail environment remains challenging, with a 0.7% year-on-year decline in total retail sales of consumer goods, contrasting with a 23.0% increase in the previous year[8] - The national fitness plan (2021-2025) is expected to generate RMB 5 trillion in revenue for the sports goods industry, supported by various government policies[8] - The company continues to see an increase in public health awareness, leading to a growing participation in sports and fitness activities despite the challenging consumption environment[8] Digital and Online Sales - Online sales in the retail business saw significant growth, particularly community-driven private domain sales, which doubled their contribution to total sales compared to the previous year[12] - The contribution of online private domain sales to total sales doubled year-on-year, effectively compensating for the decline in offline foot traffic due to the pandemic[16] - The company continues to enhance its digital tools for better consumer interaction and operational efficiency, adapting to changing retail environments[12] Store Operations - The number of direct-operated stores decreased by 767 compared to February 28, 2022, totaling 6,928 stores as of August 31, 2022, with a gross sales area reduction of 5.1%[12] - The proportion of large stores (over 300 square meters) increased to 14.9% as of August 31, 2022, up 2.0 percentage points from February 28, 2022[13] Membership and Community Engagement - Cumulative registered members reached 60.2 million as of August 31, 2022, representing a 28% year-on-year increase, while community friends exceeded 9 million, nearly doubling year-on-year[15] - Cumulative registered members increased from 50.9 million in November 2021 to 60.2 million by August 31, 2022, with member sales contributing 93.6% of total in-store retail sales[17] Dividend and Shareholder Returns - The interim dividend declared for the fiscal year ending February 28, 2023, is RMB 0.13 per share, with a payout ratio of 70.4%[11] - The company declared an interim dividend of RMB 0.13 per share, totaling RMB 806.2 million, to be paid around December 15, 2022[41] Financial Position - Total assets as of August 31, 2022, amounted to RMB 17,688.9 million, a slight decrease from RMB 17,796.3 million as of February 28, 2022[51] - Total liabilities increased to RMB 7,793.3 million from RMB 7,214.8 million, with current liabilities rising significantly due to short-term borrowings of RMB 2,028.0 million[51] - Net assets decreased to RMB 9,895.6 million from RMB 10,581.5 million, reflecting a decline in retained earnings[53] - Cash and cash equivalents at the end of the period stood at RMB 1,676.6 million, a decrease from RMB 1,752.6 million at the beginning of the period[58] Employee and Operational Costs - The group employed a total of 32,745 employees as of August 31, 2022, down from 40,913 employees as of February 28, 2022[38] - Total employee costs for the six months ended August 31, 2022, amounted to RMB 1,488.0 million, representing 11.3% of the group's revenue, compared to 10.4% for the same period in 2021[38] Risk Management and Governance - The group has not reported any significant changes in its risk management policies since February 28, 2022[64] - The company has adopted the corporate governance code as its own governance code and has complied with all applicable provisions[109] - The audit committee consists of three independent non-executive directors and has reviewed the financial information for the six months ended August 31, 2022[111]