Xtep reports a 5.2 percent revenue decrease in 2017

Xtep has recently announced its 2017 annual results, reporting a 5.2 percent revenue drop to RMB 113.4 million, which is “mainly due to retail channel restructuring”.

Net profit declined by 22.7 percent to RMB 408.1 million because “one-time loss on buy-back of inventories amounted to RMB120.8 million”, according to the official results.

As shown in the announcement, the decline in revenue in second half of 2017 narrowed to 2.1 percent, representing an increase from 8.8 percent decrease in the first half of the same year.

Driven by streamlining business divisions and increasing contribution from e-commerce, its gross profit margin continued to expand for the 5th year in a row, with a growth of 0.7 percent to 43.9 percent.

In 2017, Xtep’s exclusive distributors have been transformed from wholesalers to partial retailers, as the brand’s directly managed stores are over 60% of the total Xtep stores.

The reports said that 2017 marked the last year of Xtep’s strategic transformation. In the future, the company aims to leverage its brand equity, with the goal of building a sports brand and sports ecosystem that includes events and community.

For the year 2018, besides broadening brand loyalty beyond products, Xtep has plans to launch new proprietary technology in footwear based on research from its laboratory.

Source: Sina

Proofread by William Logsdon