LI NING(02331)2023-03-16 22:14Financial Performance - Revenue increased by 14.3% to RMB 25,803.83 million, with a net profit of RMB 4,063.77 million, maintaining a net profit margin of 15.7%[2] - Gross profit margin decreased by 4.6 percentage points to 48.4% due to rising raw material costs[2] - Total comprehensive income for the year was RMB 4,055.39 million, compared to RMB 4,008.33 million in 2021[7] - The company reported a basic earnings per share of RMB 155.38, slightly down from RMB 160.10 in the previous year[6] - The profit attributable to equity holders for 2022 was RMB 4,063,834,000, compared to RMB 4,010,881,000 in 2021, representing an increase of approximately 1.3%[31] - The basic earnings per share for 2022 was RMB 155.38, down from RMB 160.10 in 2021, reflecting a decrease of about 4.5%[31] - The diluted earnings per share for 2022 was RMB 154.34, compared to RMB 157.97 in 2021, indicating a decline of approximately 2.1%[32] - Gross profit for the same period was RMB 12,484,793,000, reflecting a 4.3% increase from RMB 11,969,098,000 in 2021[42] - Operating profit decreased by 4.9% to RMB 4,886,758,000 from RMB 5,136,376,000 in the previous year[42] - EBITDA for the year was RMB 6,541,707,000, a slight increase of 1.6% from RMB 6,436,060,000 in 2021[42] Revenue Breakdown - Revenue from footwear reached RMB 13,478,630,000, up 42.5% from RMB 9,505,994,000 in 2021[14] - Revenue from apparel decreased to RMB 10,708,594,000, down 9.4% from RMB 11,823,798,000 in 2021[14] - Revenue from equipment and accessories increased to RMB 1,616,159,000, up 30.2% from RMB 1,242,489,000 in 2021[14] - Sales through e-commerce channels amounted to RMB 7,465,297,000, an increase of 16.4% from RMB 6,412,920,000 in 2021[15] Assets and Liabilities - Total assets increased to RMB 33,646.52 million from RMB 30,274.82 million in 2021, with non-current assets rising significantly[4] - Current assets decreased to RMB 12,394.90 million from RMB 18,671.85 million, primarily due to a reduction in cash and cash equivalents[4] - The total accounts payable decreased slightly from 1,599,282,000 RMB in 2021 to 1,584,424,000 RMB in 2022, a decrease of about 0.9%[22] - The debt-to-equity ratio improved to 38.3% from 43.5% in the previous year[42] Cash Flow and Financing - Operating cash inflow reached RMB 3,914 million, indicating healthy operational liquidity with an average working capital ratio of 6.8%[2] - The net cash generated from operating activities for the year ended December 31, 2022, was RMB 3,913,604,000, a decrease from RMB 6,525,335,000 in 2021[57] - The net financing income for 2022 was 327,187,000 RMB, a substantial increase from 32,639,000 RMB in 2021[26] - Financing income increased significantly to 447,748,000 RMB in 2022 from 145,097,000 RMB in 2021, a growth of about 208.5%[25][26] Expenses and Costs - Total sales and distribution expenses rose by 19.2% to RMB 7,314,303,000, accounting for 28.3% of total revenue, up from 27.2% in 2021[48] - Research and product development expenses rose to 534,156,000 RMB in 2022, up from 413,949,000 RMB in 2021, an increase of about 29.0%[23] - Advertising and marketing expenses increased significantly, which rose to 2,279,152,000 RMB in 2022 from 1,779,263,000 RMB in 2021, an increase of approximately 28.1%[23] - The cost of goods sold increased significantly to 12,979,293,000 RMB in 2022 from 10,340,415,000 RMB in 2021, representing a rise of approximately 25.8%[23] Inventory and Receivables - Inventory turnover and aging structure remained at a good level, with channel inventory planned to be 20%-30% ahead of schedule[2] - Trade receivables, net of expected credit loss provisions, were RMB 1,020,346,000, up from RMB 902,857,000 in 2021[20] - The total accounts receivable aged analysis shows a decrease in the 0 to 30 days category from 681,627,000 RMB in 2021 to 579,558,000 RMB in 2022, a decline of approximately 15.0%[21] - Inventory costs recognized as expenses for the year were RMB 12,979,293,000, an increase from RMB 10,340,415,000 in 2021[19] Dividends and Shareholder Information - The company proposed a final dividend of RMB 0.4627 per share, up from RMB 0.4597 per share in 2021[2] - The total dividends paid for the year ended December 31, 2022, amounted to RMB 1,194,720,000, significantly higher than RMB 515,202,000 for the year ended December 31, 2021[33] - The record date for the proposed final dividend is June 21, 2023[38] Market and Sales Strategy - The company operates primarily in the Chinese market, with overseas sales accounting for no more than 10% of total revenue[13] - The company plans to enhance collaboration with distributors to promote order growth and channel development while optimizing the aging structure of receivables[56] - The company emphasized a multi-channel strategy, integrating professional products with entertainment marketing to reach a broader audience[69] - The company launched new product marketing strategies centered around women's fitness, enhancing brand recognition and user engagement through collaborations with KOLs and social media platforms[71] Product Development and Innovation - The company achieved cumulative sales of over 3 million pairs of the "超轻19" running shoes, making it a phenomenal product in the running market this year[66] - The basketball category introduced the "馭帥16" shoe, integrating popular colorways and advanced technology, enhancing consumer experience[66] - The badminton category launched the "戰戟8000" control series racket, completing a three-category layout with multiple patented technologies[67] - The company emphasized R&D in innovative technologies, expanding the use of functional materials in professional sports products[80] Corporate Governance and Compliance - The company adhered to the corporate governance code as per the Hong Kong Stock Exchange listing rules, with some deviations explained, including the roles of the chairman and CEO being held by the same individual[89] - The company is committed to eliminating forced labor risks in its supply chain and will conduct annual assessments of suppliers' compliance with social responsibility standards[81] Future Outlook - The Chinese economy is steadily recovering, boosting national consumer demand and benefiting sports consumption, which will promote the development of the sports industry[87] - The company is optimistic about the sports industry's prospects, believing it has significant development potential, and aims to innovate and expand its brand presence in the professional sports sector[87]