China shoe retailer Belle International Holdings has reported a 38 per cent drop in its annual net profit as consumers have increasingly shifted to “athleisure” products away from traditional fashion footwear and dress shoes.
Its net profit nearly halved to 2.93 billion yuan (US$447 million) for the year ended in February 29 from 4.76 billion yuan the previous 12 months.
CEO Sheng Baijiao blames the group’s lacklustre performance on changes in consumer taste and shifting style preferences.
However, revenue edged up 2 per cent to 40.79 billion yuan for Belle, which distributes such sportswear brands as Adidas, Asics, Converse, Nike, Puma and Timberland. While sportswear revenue jumped 16.2 per cent and footwear sales slid 8.5 per cent, footwear accounted for 52 per cent of total revenue and sportswear 48 per cent.
Belle’s gross profit margin eased to 56.3 per cent from 57.5 per cent.
At the end of February, the company was directly managing 20,873 retail outlets in China, including 13,762 footwear and 7111 sportswear outlets. A year ago it had 20,557 outlets.