Investment Rating - The report maintains a "Buy" rating for the company [4][9] Core Views - The company is experiencing pressure on its FY25 performance, with a revenue decline of 6.6% year-on-year, resulting in a net profit drop of 41.9% [8] - Despite the challenges, the company is expected to maintain a high dividend payout ratio of 134%, exceeding market expectations [8] - The company is adjusting its revenue and gross margin forecasts for FY26-27 and introducing FY28 projections, with expected earnings per share of 0.21, 0.25, and 0.30 RMB respectively [3][9] Financial Performance Summary - FY24A revenue was 28,933 million RMB, while FY25A revenue decreased to 27,013 million RMB, with a projected FY26E revenue of 26,428 million RMB [3] - The gross profit margin for FY25A was 38.4%, down from 41.8% in FY24A, primarily due to increased retail discounts [8] - The net profit margin for FY25A was 4.8%, a decrease of 2.9 percentage points from the previous year [8] - The company’s cash flow from operating activities was 3,129 million RMB in FY23, with a net cash position of 25.9 million RMB at the end of FY25 [8] Market Position and Strategy - The company has been actively adjusting its store strategy, closing 1,124 stores while opening 258 new ones, resulting in a total of 5,020 stores by the end of FY25 [8] - New brand collaborations are being established, including partnerships with SOAR running and Norrøna, aimed at enhancing market presence in high-end segments [8]