Chinese sportswear company Exceed has delivered third quarter net profit fall of 79 per cent citing challenging market conditions.

Exceed, which operates Xidelong brand, said net income fell 30.4 million yuan (US$4.8 million) for the quarter to September 30 from 144.8 million yuan the previous year.

“The global macroeconomic slowdown continued to impact Chinese consumer demand for sportswear throughout the third quarter to a greater extent than we initially anticipated,” said Exceed’s founder, chairman and CEO Shuipan Lin.

Gross revenue decreased 48.1 per cent to 553.3 million (US$88 million) from 1065 million yuan a year earlier resulted from the decrease in the delivery of products to distributors.

Apparel, which accounted for 53.1 per cent of the total revenue, dropped 45.7 per cent to 294 million yuan (US$46.8 million) while footwear, which accounted for 44.5 per cent of the total revenue, declined 51.7 per cent to 246.2 million yuan (US$39.2 million). The declines were blamed on decreasing sales.

The company expects to continue to operate in unfavourable economic conditions for the remainder of the year and believes that consumer demand for sportswear products in China will remain generally weak.

However, the company said it is positioned to weather the current cyclical downturn through its active management of production and prudent response to downward pricing pressure in the industry.

Exceed currently operates 5021 Xidelong stores.

GB