Anta profits surge as sales rise 22.5%

A production line of Anta Sports Product Ltd in Bozhou, Anhui province. The company posted the best-ever annual sales performance on Wednesday. [Photo provided to China Daily]

Fujian-based sportswear giant Anta Sports Product Ltd posted its best-ever annual sales performance on Wednesday, after its initial public offering in Hong Kong in 2007.

The Hong Kong-listed sportswear manufacturer saw sales hit 8.9 billion yuan ($1.42 billion) in 2014, a 22.5 percent increase from the levels seen in 2013. Gross profit exceeded 4 billion yuan, with a 32.5 percent year-on-year growth.

The company also announced a dividend payout ratio of 71 percent of the profit attributed to equity shareholders for the year, thanks to its strong cash flows.

"The group has achieved remarkable results for the year due to the growing demand for differentiated value-for-money Anta products, particularly the booming kids sportswear series, and the Fila business," said Ding Shizhong, chairman and CEO of the company.

Anta Sports acquired Italian brand Fila in 2009, and has been using it to feed the high-end consumer market in China, and also as a supplementary to its Anta brand products, which target the mass consumer market.

"The second-tier and third-tier cities continue to be the strongest market and source of income for Anta, but Fila has been doing a good job to elevate our image in the mega cities," he said.

Ding said 20 percent of the company's sales came from first-tier cities, and the company will strive to maintain a strong presence in second- and third-tier cities of China.

The company has also been making efforts to strengthen its market presence and appeal, including setting up an alliance with NBA China and creating "Anta-NBA" co-branded shoes and accessories to its kids product portfolio.

It also roped in Lee Min-ho, the South Korean singer, actor and model, as its brand ambassador for Fila, with an eye on enhancing the brand appeal to consumers.

To strengthen the stylish elements in its product, Anta has also teamed up with ethnic Chinese fashion designer Anna Sui to launch the "Anna Sui for Fila" collection in 2014.

James Zheng, executive director and Anta brand president, said: "We have adopted the multi-brand strategy and diversified product portfolio method to capture the opportunities in various high potential markets. And we are confident sales performance will stay good in the year 2015."

Ding, the chairman, said the company was scouting for suitable international brands for possible merger and acquisition deals, and indicated that the company was in advanced talks with some of them.

Meanwhile, the company plans to further reduce store numbers in 2015, and to expand its e-commerce channels. The number of Anta stores by the end of 2014 was 7,622, 1.7 percent down from 2013. Fila and Anta kids sportswear stores stood at 519 and 1,228 by the end of last year.