Anta Sports Expects Q1 Performance Decline In The Second Half To Return To Normal Level

With the rapid growth of FILA in 2019, Anta gained a brilliant performance since its launch. In March 24th, Anta sports released its 2019 performance report. Its annual revenue reached 33 billion 927 million yuan, an increase of 40.8% over the same period last year. Among them, FILA brand realized revenue of 14 billion 770 million yuan, an increase of 73.9% over the same period, and gross profit margin reached 70.4%.

According to the growth data analysis, combined with the 2020 Tokyo Olympic Games and major sporting events, 2020 Anta sports should have a stronger development. However, a sudden outbreak interrupted the growth momentum.

On March 24th, Japanese Prime Minister Abe Shinzo agreed with International Olympic Committee President Bach and issued a joint statement that the Tokyo Olympic Games will be postponed to 2021, but not later than 2021. Anta is an official sportswear supplier of International Olympic Committee. It will provide clothing, shoes, accessories and other equipment for the 2020 Tokyo Olympic Games. Fortunately, after the deliberations, the name of the tournament is still "Tokyo 2020 Olympic Games and Paralympic Games", so the sponsoring brand can reduce the related losses.

Zheng Jie, executive director and CEO of Anta group, said when the marketing plan of Tokyo Olympic Games Anta was raised, the approximate rate of the Olympic Games would be delayed and the corresponding marketing plan would be delayed. He further said that if the Olympic Games were not held this year, the impact on the whole business of Anta would not be so great. "More importantly, it depends on consumers' consumption intention and consumption motivation. At present, the whole year's business is not so pessimistic, nor optimistic. The first half is relatively conservative. We hope to return to normal growth level in the second half. "

According to Anta group management at the performance exchange meeting, the group was affected by the epidemic. In the 2020 quarter of the first quarter, it was estimated that the sales decline of Anta brand line was between 20%-30%, and the business of FILA brand line was down 10%-20%, which affected the overall epidemic situation. The first half performance guideline of management was expected to decline in the 10%-15% range.

Due to the domestic epidemic affecting mainly in 1-2 months, the first quarter affected brands were Anta and FILA. In March, with the outbreak of the epidemic overseas, Amer was also affected. However, most of the Amer products were winter clothing and occupied funds in the three quarter.

Analysis of the relevant personages, the great impact of the epidemic on Anta may come from its inventory crisis, because Anta sports performance in the rapid growth at the same time, also exposed a problem, that is, the increase of inventory. From 2015 to 2019, the stock of Anta sports has increased from 1 billion 20 million yuan to 4 billion 410 million yuan. Especially after 2017, the growth rate of inventories was 66.4%, 34.2% and 52.9% respectively.

If it were in the past, Anta sports could ease the stock pressure through various promotional activities. But this year, when the Olympic Games are postponed, the slower turnover rate may accelerate the problem of backlog.

At present, Anta sports 2020 plans to increase sales and marketing, and reduce the year-round store opening plan accordingly. At the same time, it improves the proportion of online operation. Anta's sales in 2019 on Tmall, Jingdong, vip.com and other online platforms increased by 40%. In the first quarter, Anta's online sales accounted for about 25%, and FILA sales accounted for about 20%.