China’s sportswear woes continue

Yet another player in China’s sportswear sector has revealed a challenging year – Exceed says its net profit slid more than 50 per cent.

Xidelong-parent Exceed booked a net profit of US$31.9 million, representing 57.7 per cent decrease. Revenue declined 27.5 per cent while operating profit fell 53.5 per cent.

The weak demand is a result of on-going global macroeconomic uncertainties and tepid domestic economic growth, says chairman and CEO Shuipan Lin.

While this year is expected to remain unfavorable, the company is optimistic that the Chinese sportswear industry continues to present significant long-term growth opportunities.

“We will remain focused on maintaining our lean operating structure by effectively managing costs and on continuing to strengthen brand awareness. We believe that these measures will allow us to maintain a competitive position in this difficult market environment and place the company in a favorable position to grow over the long-term,” said Lin.

Exceed opened 65 additional Xidelong stores last year, taking its count to 4909.

Exceed is not alone in suffering from challenging market conditions. Its local peer Li Ning also posted nearly two billion yuan profit loss, prompting it further trim network.

Only foreign rival Adidas appears to be posting genuine growth in both market share and sales.

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