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Monday 14 September 2009
Multipronged strategy drives sales up 33.5pc
Despite a challenging global environment, leading mainland-based international sportswear enterprise China Dongxiang (Group) has shown strong financial performance for the six months ended June.
Despite a challenging global environment, leading mainland-based international sportswear enterprise China Dongxiang (Group) has shown strong financial performance for the six months ended June.
China Dongxiang, together with its subsidiaries, is primarily engaged in the design, development, marketing and wholesaling of branded sportswear on the mainland. It recorded sales of 1.9 billion yuan (HK$2.2 billion) for the first six months of the year, a year-on-year increase of 33.5 per cent.
Profit to equity holders totalled 722 million yuan, a 9.9 per cent increase compared with the same period last year (excluding a one-off gain from the acquisition of Phenix), and the growth rate in profit attributable to equity holders reached 41.3 per cent. Basic earnings per share were 12.74 fen.
Chen Yihong, China Dongxiang’s chairman, said the results were propelled by strong brand equity and good management execution during a period of volatile economic turmoil.
“We initiated and executed various positive measures to combat the adverse impact brought about by the financial tsunami,” he said. “At the same time, we assessed business opportunities cautiously to maintain a strong financial position and effective operational management system.”
He said the company closely monitored the operational performance of retail channels by co-operating with distributors to launch a series of channel management enhancements.
“We believe that our long-term strategy for maintaining product and price positioning is essential for us to preserve the strengths and image of our Kappa brand,” Chen said. “The Kappa brand is our first brand and it has provided a very solid foundation for us to deploy our multibrand strategy.”
Chen revealed the company had launched a series of marketing campaigns, which had successfully strengthened the positioning of its Kappa brand as fashionable sportswear attire.
He said these campaigns have helped to increase brand awareness among customers.
Since May 2006, China Dongxiang has owned all rights to the internationally recognised Kappa brand on the mainland, Macau and Japan.
Last year, the company successfully completed its acquisition of a Japan sportswear enterprise Phenix, which has the largest market share of the skiing and outdoor sportswear market in Japan.
Chen said the company would continue to adopt an optimistic yet prudent approach to ensure secure and healthy business growth. The company would also continue to pursue its long-term development in four key areas: brand building, retail network expansion, internal operations enhancement and multibrand strategy.
“We believe that the multibrand strategy will bring benefits to our shareholders and investors,” Chen said. In terms of marketing and promotion strategies, Chen said China Dongxiang would continue to sponsor selective fashion and sports activities which closely tie-in with Kappa’s brand image.
Last month, Kappa Golf was appointed the official partner for the provision of golf apparel at the World Golf Champions - HSBC Champions.
Sales of Kappa brand products increased by 30.2 per cent to 1.7 billion yuan, accounting for 89.6 per cent of the group’s total sales for the period under review.
In line with China Dongxiang’s strategy to maintain a stable product mix designed to minimise risks, apparel represented 73.4 per cent, footwear represented 21.9 per cent, while accessories represented 4.7 per cent of the brand’s total sales respectively.
The number of Kappa brand retail outlets on the mainland directly and indirectly operated by the group’s distributors increased by 507 to 3,315 outlets from the end of last year.
Adapting to changing market trends, China Dongxiang is able to draw on the experience and talent of a team of mainland and international designers who continue to strengthen the company’s market position by offering products with active, fashionable and youthful designs.
In July, it went into agreement with adidas’ formal global creative director Michael Michalsky to develop and launch a new collection under the Kappa brand.
Chen said the company would also continue to co-operate with its distributors to open shops on the mainland.
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Multipronged strategy drives sales up 33.5pc
Chris Davis
14 September 2009
Despite a challenging global environment, leading mainland-based international sportswear enterprise China Dongxiang (Group) has shown strong financial performance for the six months ended June.
China Dongxiang, together with its subsidiaries, is primarily engaged in the design, development, marketing and wholesaling of branded sportswear on the mainland. It recorded sales of 1.9 billion yuan (HK$2.2 billion) for the first six months of the year, a year-on-year increase of 33.5 per cent.
Profit to equity holders totalled 722 million yuan, a 9.9 per cent increase compared with the same period last year (excluding a one-off gain from the acquisition of Phenix), and the growth rate in profit attributable to equity holders reached 41.3 per cent. Basic earnings per share were 12.74 fen.
Chen Yihong, China Dongxiang’s chairman, said the results were propelled by strong brand equity and good management execution during a period of volatile economic turmoil.
“We initiated and executed various positive measures to combat the adverse impact brought about by the financial tsunami,” he said. “At the same time, we assessed business opportunities cautiously to maintain a strong financial position and effective operational management system.”
He said the company closely monitored the operational performance of retail channels by co-operating with distributors to launch a series of channel management enhancements.
“We believe that our long-term strategy for maintaining product and price positioning is essential for us to preserve the strengths and image of our Kappa brand,” Chen said. “The Kappa brand is our first brand and it has provided a very solid foundation for us to deploy our multibrand strategy.”
Chen revealed the company had launched a series of marketing campaigns, which had successfully strengthened the positioning of its Kappa brand as fashionable sportswear attire.
He said these campaigns have helped to increase brand awareness among customers.
Since May 2006, China Dongxiang has owned all rights to the internationally recognised Kappa brand on the mainland, Macau and Japan.
Last year, the company successfully completed its acquisition of a Japan sportswear enterprise Phenix, which has the largest market share of the skiing and outdoor sportswear market in Japan.
Chen said the company would continue to adopt an optimistic yet prudent approach to ensure secure and healthy business growth. The company would also continue to pursue its long-term development in four key areas: brand building, retail network expansion, internal operations enhancement and multibrand strategy.
“We believe that the multibrand strategy will bring benefits to our shareholders and investors,” Chen said. In terms of marketing and promotion strategies, Chen said China Dongxiang would continue to sponsor selective fashion and sports activities which closely tie-in with Kappa’s brand image.
Last month, Kappa Golf was appointed the official partner for the provision of golf apparel at the World Golf Champions - HSBC Champions.
Sales of Kappa brand products increased by 30.2 per cent to 1.7 billion yuan, accounting for 89.6 per cent of the group’s total sales for the period under review.
In line with China Dongxiang’s strategy to maintain a stable product mix designed to minimise risks, apparel represented 73.4 per cent, footwear represented 21.9 per cent, while accessories represented 4.7 per cent of the brand’s total sales respectively.
The number of Kappa brand retail outlets on the mainland directly and indirectly operated by the group’s distributors increased by 507 to 3,315 outlets from the end of last year.
Adapting to changing market trends, China Dongxiang is able to draw on the experience and talent of a team of mainland and international designers who continue to strengthen the company’s market position by offering products with active, fashionable and youthful designs.
In July, it went into agreement with adidas’ formal global creative director Michael Michalsky to develop and launch a new collection under the Kappa brand.
Chen said the company would also continue to co-operate with its distributors to open shops on the mainland.
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