August 13, 2018 / 12:46 AM / 3 months ago

China's Li Ning H1 profit rises 42 pct amid robust sports market

HONG KONG, Aug 13 (Reuters) - Chinese sportswear maker Li Ning Co Ltd on Monday posted a 42 percent rise in first-half profit, helped by improved inventory controls and stronger sales growth.

China’s best-known home-grown sports brand said first-half net profit rose to 268.6 million yuan ($39.2 million), from 189.2 million yuan the same period a year earlier.

Total revenue increased 17.9 percent to 4.7 billion yuan for the six months ended in June, from 3.99 billion yuan the same period a year earlier.

Chairman Li Ning said the company would continue to close down or reform inefficient stores and open or revamp big stores with high efficiency.

The number of Li Ning-brand outlets or sales counters in China amounted to 6,898 as of end-June, a net increase of 463 since the beginning of this year.

“We will continue to promote the development of digitalisation strategy so as to further enhance the efficiency of both online and offline sales,” Li said in the statement.

Gross profit margin expanded 1 percentage point to 48.7 percent in the first half. Overall same-store-sales posted a high-single digit growth.

“In respect of products, we will continue to integrate professional sports with fashion, entertainment and leisure to enhance product competitiveness,” Li added.

Analysts expect solid fundamentals for Chinese sportswear brands following destocking in the previous year. ($1 = 6.8458 Chinese yuan renminbi) (Reporting by Donny Kwok; Editing by Stephen Coates)

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