HONG KONG Aug 14 Chinese sportswear maker Li
Ning Co Ltd said it made a first-half net loss of
nearly $100 million, much wider than a year earlier, as it
soaked up one-off charges and the cost of opening more stores
amid fierce competition in the industry.
Li Ning, which faces off in China against global industry
giants like Nike Inc, said in a Hong Kong stock exchange
filing its net loss widened to 585.8 million yuan ($95 million)
from a net loss of 184.2 million yuan in the same period a year
But China's second-biggest home-grown sportswear maker said
first-half revenue rose 8 percent year-on-year to 3.14 billion
yuan, helped by higher sales of new products as it expanded its
chain of directly operated stores. Li Ning said that with the
"first phase" of a turnaround plan complete, it now plans to
focus on boosting its brand image.
The company, whose investors include private equity firm TPG
Capital Management and Singapore sovereign wealth fund
GIC, had warned in July that it would post at least 550
million yuan loss for the first half.
"As the first phase of the turnaround is completed with an
optimised and stable store network, the company is poised for
the next stage of re-expansion," founder and chairman Li Ning
said in the filing to the Hong Kong bourse. The firm had said in
March that restructuring would "take time to reflect fully" in
its financial results.
Li Ning faces stiff competition from Chinese rivals as well
as international peers. Earlier this month ANTA Sports Products
Ltd, China's biggest listed footwear retailer by
market value, posted a forecast-beating 28 percent rise in
Earlier this year, Li Ning also lost out to ANTA Sports in
securing a sponsorship deal with Chinese national gymnastics
Other Chinese rivals like Peak Sport Products Co Ltd
, 361 Degrees International Ltd and Xtep
International Holdings Ltd are due to announce their
earnings later this month.
(1 US dollar = 6.1531 Chinese yuan)
(Reporting by Donny Kwok; Editing by Kenneth Maxwell)