Anta Sport sees record profit, Chinese sporting sector on fire
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Anta Sport sees record profit, Chinese sporting sector on fire

Chinese sporting goods and apparel seller Anta Sports saw record profit for 2017. It’s the third straight year that the company has beaten previous records, and comes as China continues to embrace modern sporting-casual culture. What’s next on Anta’s radar? Having conquered the east, the company is looking to become a major player internationally.

Anta Sports’ share price has appreciated by 15% so far this year

graph 0103 anta sport

SOURCE: Yahoo Finance

The company’s chairman, Ding Shizhong, released a statement that laid bare the company’s global ambitions. It read: “We will not be complacent with only being the leading multi-brand company in China as we aspire to become (a) competitive multi-brand company in the world.”

Anta is benefitting from both structural trends – the increasing popularity of sports in China – and well made strategies. The company sells both the FILA and Descente brands in China alongside its homegrown Anta brand, mixing European prestige with Chinese national pride. All of these products might be described as “high end” – the segment of the market growing with most fervor.

Anta is also winning the price war, setting its prices below global brands like Nike and Adidas, and benefitting from higher online sales – another area in which it is leading the pack.

For 2017, revenue surged by 25% year on year to 16.69 billion yuan. Gross profit margin increased by a percentage point to 49.4% over the same timeframe. But the biggest win was yet another broken record when it comes to annual profit: the company said that net profit rose by 29.4% against the previous year to 3.09 billion yuan. It says a lot about the strength of the brand that this was bang in-line with analysts’ expectations.

Disclosure

Dominion holds Anta Sports in its Global Trends Luxury Fund.


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