Investment Rating - The report maintains a "Buy" rating for the company with a target price of 6 HKD, reflecting a 12x PE for 2024 [1][3][5]. Core Insights - The company achieved a record high in annual performance for 2023, with revenue reaching 14.346 billion RMB, a year-on-year increase of 10.9%, and a net profit attributable to shareholders of 1.03 billion RMB, up 11.8% year-on-year [2][3]. - The company declared a final dividend of 0.08 HKD per share, resulting in a total payout ratio of 50% for the year [1][3]. - The company successfully reduced inventory by 21.6% to 1.794 billion RMB, indicating effective inventory management [2][3]. Revenue Breakdown - The main brand, Xtep, saw a revenue increase of 7.4% to 11.947 billion RMB, while the professional sports segment, including Saucony, experienced a significant growth of 98.9% to 796 million RMB [2][3]. - The fashion sports segment reported a revenue increase of 14.3% to 1.603 billion RMB, with a remarkable 224.3% growth in revenue from mainland China [2][3]. Profitability Metrics - The gross margin improved by 0.7 percentage points to 42.2%, with the main brand's gross margin also increasing by 0.7 percentage points to 42.0% [2][3]. - The net profit margin for 2023 was 7.2%, reflecting a slight increase from the previous year [12]. Future Earnings Projections - The report forecasts EPS for 2024, 2025, and 2026 to be 0.45, 0.53, and 0.60 RMB respectively, indicating a steady growth trajectory [1][3][4]. Store Expansion - As of the end of 2023, the company operated 6,571 stores in mainland China and overseas, with a net increase of 258 stores [2][3]. - The children's brand had 1,703 stores in mainland China, marking a net increase of 183 stores [2][3]. Strategic Developments - The company acquired 40% of Saucony's intellectual property in China and the remaining stake in the joint venture with Wolverine, enhancing its control over the brand and facilitating synergies between its brands [3][4]. - The report emphasizes the potential for multi-brand growth and market share expansion through strategic brand integration [3].
全年业绩再创新高，索康尼快速增长实现盈利