Sports Retail Giant "Tao Bo" Handed Over The First Earnings Report After The Listing, Net Profit Increased By 21.2%

In the evening of October 23rd, the largest sports footwear retail platform in China released its first earnings after listing.

According to the results of the report, the income of the company has reached 16 billion 958 million yuan in the six months ended August 31, 2019, an increase of 12.4% over the same period last year. The adjusted operating profit was 2 billion 161 million yuan, an increase of 20.3% over the same period last year. The profit of the company's equity holders should be about 1 billion 471 million yuan, up 21.2% over the same period last year. Previously, CITIC Securities, which has long been concerned about the development of the industry, has given the "buy" rating.

It is reported that Tao Bo is China's largest retail platform for sports shoes and clothing, and has the largest and highly sinable sports shoe clothing direct store network in China, which closely surrounds consumers. According to the retail sales in 2018, Tao Po's share in China's sports footwear market reached 15.9%. The company's brand portfolio currently includes Nike, Adidas, Puma and so on. It is Nike's second largest retail partner in the world and is the largest retailer in the world.

Operating strategy continued to upgrade revenue growth net profit steady growth

In the first half of February 29, 2020, in the first half of fiscal year, the company continued to expand its efficiency, membership, income and profitability through expanding the consumer centered retail platform, enhancing differentiated services, expanding the breadth and depth of contacts with consumers.

We should optimize and upgrade the efficient retail stores in order to create better user service experience and enhance the company's operational efficiency.

According to the financial report, by the end of August 31, 2019, there were 545 stores with 300 square meters or more, with an increase of about 30% in six months. In the same period, the retail outlets increased by 22, and the gross sales area increased by 5.2%.

In terms of membership, it has steadily increased the number of registered members and the number of active shopping members by continuously enriching members' benefits and deepening interaction with consumers. According to the financial report, as of August 31, 2019, the total number of registered members reached 21 million 200 thousand, and the number of active shoppers reached nearly 6 million, accounting for 81.4% of the total sales.

At the same time, with the deepening of the transformation of technology and digitalization, the overall income level and profitability of Tao Po have been greatly improved. According to the earnings data, as of the six months ended August 31, 2019, Tao Bo earned 16 billion 958 million yuan, an increase of 12.4% over the same period last year, and the profits of the company's equity holders should be about 1 billion 471 million yuan, up 21.2% from the same period last year, and gross profit was about 7 billion 410 million, an increase of nearly 15% over the same period last year.

Cheng Weixiong, general manager of textile and clothing brand management and Shanghai Liang Qi Brand Management Co., Ltd., also said that he is optimistic about the long-term development prospects of Tao Bo, which is not only the core retail partner of the world's top sports brands, but also runs the biggest sports shoe and clothing network in China, and embraces consumers through members and communities. Digital reform has further enhanced the operation capability of Tao Po. At present, the competition barrier formed by Tao Bo is difficult to surpass in a short time.

Golden track has great imagination in the future.

In recent years, the development prospect of sports apparel industry has been continuously favored by the market, and the government has also put forward many supportive policies for China's sports industry. The Research Report of Guosheng Securities pointed out that in 2018, the total market of sports shoes and clothing in China was about $40 billion 100 million, an increase of 19.5% over the same period last year, and the market will maintain more than 9% of CAGR in the next five years, which is a very prosperous consumer segmentation field.

CITIC Securities also pointed out that the current sports sector is one of the most robust downstream areas of clothing under the macroeconomic slowdown. The industry continues to expand its market, and the trend of sports and fashion is popular.

The above market situation makes the retail leader represented by Tao Bo obviously dominant in the depth of channel layout, retail management and brand cooperation. Apart from benefiting from the continuous favorable policies of the industry, the leading brands' attention to upgrading the first class partners will also make them enjoy a more concentrated dividend.

As the largest international brand retailer in the Chinese market, the comprehensive ability has been favored by international brands and is the first choice for international brands to enter the Chinese market.

With the rapid growth of the domestic sports market and the constant upgrading of consumer preferences, based on the important position of directly interacting with consumers and familiarity with the actual situation of various regional markets, the cooperation between Tao Bo and branding has deepened, not just in simple retail relationships. Moreover, as the offline experience becomes more critical, the value of the brand is more obvious.

According to the analysis of the industry, for the growth and stability of Tao Bo, it is quite imaginative in the future under the background of the domestic sports market warming.