Chinese sportswear retailer China Dongxiang says it will be closing stores in Mainland China, but is optimistic about the business’ future.

China Dongxiang owns all rights to the Kappa brand in China, Macau and Japan.

Releasing second-quarter results, Dongxiang says offline sales in its Kappa-branded stores (excluding Kappa Kids and the Japanese business), fell by mid to low single-digits year on year for the quarter, while overall retail performance remained stable compared to the same period last year.

CEO and president of China Dongxiang, Zhang Zhiyong, says the group “is dedicated to engaging new regional retailers with strong sales potential to provide a driving force for the opening of more high-retail performance stores for the second half of the year, while the retail performance of the 45 stores which had undergone renovation during the period was prominently improved”.

“Going forward, the company will also be closing down stores with lower retail performance, ensuring the high same-store sales growth for the year. In view of the above, we believe the Kappa brand has survived its most difficult period and are confident of the group’s future development.”