Many Sporting Goods Companies Have Fallen To The Bottom Of The Market Under High Inventory Pressure.

Following Lining (exclusive store) [-1.84%] Limited (02331.HK, hereinafter referred to as Lining) Notice 2012 will appear in the first 8 years of listing losses, Anta (franchised) Sporting Goods Co., Ltd. 5 years after the first net profit decline, PEAK sporting goods The net profit of the company also dropped to its lowest level in nearly five years.

Recently, PEAK released its 2012 annual report: last year's revenue was 2 billion 900 million yuan, up 37.5% compared with 2011 (year-on-year), and net profit was 310 million yuan, down 60% compared to the same period last year.

Since the beginning of 2011, local sporting goods brands are facing a stock crisis. The outside world is extremely concerned about the inventory situation of the relevant enterprises.

According to the press release released yesterday by PEAK, by the end of last year, PEAK inventories dropped to 390 million yuan, down 26.9% from 530 million yuan in the middle of last year. PEAK CEO Xu Zhihua said PEAK's inventory dropped for the first time in the industry, "this is a positive sign that the sporting goods industry is getting warmer."

However, in the view of the industry, it is now concluded that "warming up" is too optimistic.

"It can only be said that the whole industry is indeed at the bottom of the valley, but there is no sign of recovery. In 2013, the industry will continue to consolidate at low levels." Zhang Qing, chief executive of sports marketing expert and key Road Sports Consulting Co. Ltd., said yesterday that it is difficult to judge whether the performance of sporting goods companies in 2013 will be better than that in 2012.

In fact, Sports goods The industry's price war is getting hotter and hotter, and the road to inventory is doomed to be uneven. According to a recent report by reporters, from Lining, PEAK, Anta to Puma, kappa, a month ago, domestic and foreign sports brands ushered in a huge discount.

Today, foreign brands are also joining the stock market. This year, Nike plans to open 40 to 50 special discounts. Factory store This scale is far more than before. Nike's newly opened factory store will expand from the first line to the two or three line market, and the discount will be maintained at 3 to 60 percent off. In the previous second quarter (November 30, 2012) performance report, Nike's turnover in China dropped by 11% to $577 million.

Compared with Nike, Adidas's sales in China increased by 12% in the fourth quarter of last year, and increased by 27% throughout the year. However, Zhang Qing believes that this does not mean that Adidas does not have inventory problems. "Adidas's growth is benefited from its adjustment from 2008 to -2009."

The price war can partly explain why PEAK's net profit has dropped sharply while its inventory is decreasing. According to the annual report, PEAK's net profit margin in 2012 was 10.7%, and in 2011, 2010 and 2009, it was 16.7%, 19.4% and 20.3% respectively.

PEAK also announced yesterday that the company will no longer announce the order results since the third quarter of this year.

In addition to changing the order pattern, the number of retail outlets in PEAK last year has decreased by 1323.

By the end of 2012, the number of PEAK retail outlets was 6483. Xu Zhihua said yesterday that it will further adjust and hope to maintain around 6000.