TThe sports industry is worth billions of dollars and regularly attracts big names and stars who support products for business. With an increasingly fashionable healthy lifestyle, many sports companies are seeing their sales and profits increase.
Investors looking for companies in this industry should focus their attention on footwear and sportswear companies, as these companies are directly benefiting from the push towards a healthier lifestyle. As China continues to grow, the middle class segment has also grown significantly, contributing to higher demand for sportswear and footwear as more people adopt more active lifestyles.
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Here are four companies that investors can consult to gain exposure to this promising sector.
1. Li Ning Co. Ltd
Li Ning Co. Limited (SEHK: 2331) is a leading sports brand in China that manufactures sporting goods including footwear, clothing and equipment for business and leisure use. The company supports a number of athletes and teams, both in China and around the world.
For Li Ning’s first half 2019 results, revenue jumped 32.7% yoy to 6.2 billion RMB ($ 877.5 million), while operating profit jumped 130 , 6% to 678 million RMB. Net profit nearly tripled from RMB 268.5 million to RMB 795 million due to an almost tenfold increase in the profit share of equity-accounted investments.
2. ANTA Sports Products Ltd
ANTA Sports Products Ltd. (SEHK: 2020) is a leading sportswear company in China. ANTA is engaged in the design, development, manufacture and marketing of ANTA Series sportswear in the mass market. The group owns brands such as ANTA, FILA and KINGKOW.
For its first half of 2019, ANTA recorded a 40.3% year-on-year increase in revenue to RMB 14.8 billion, while operating profit jumped 58% year-on-year to 4.26 billion RMB and net profit increased 27.7% year-on-year. to 2.48 billion RMB.
3. Yue Yuen Industrial (Holdings) Ltd
Yue Yuen Industrial (Holdings) Ltd (SEHK: 551) is a Hong Kong-based Taiwanese shoe manufacturer. It is a global leader in the manufacture of athletic and leisure / outdoor footwear and has a diverse customer base. The group is the world’s largest manufacturer of branded sports and leisure footwear.
In its recent first half 2019 results, Yue Yuen reported a 6.3% increase in revenue to $ 5.07 billion, but recurring profit attributable to shareholders fell 11.8% year-on-year annual to $ 145.5 million. Its interim dividend per share was held constant at HK $ 0.40.
4. Xtep International Holdings Limited
Xtep International Holdings Limited (SEHK: 1368) is a leading multi-brand sportswear company engaged in the design, development, manufacture, sale, marketing and management of the sports product brand. The group has an extensive distribution network of more than 6,300 stores covering 31 provinces in mainland China and abroad.
For the first half of 2019, Xtep announced a 23% year-over-year improvement in revenue to RMB 3.3 billion, while operating profit also increased in line with revenue, increasing by 21.2% year on year to 717.3 million RMB. Net profit attributable to shareholders increased 23.4% year-on-year to RMB 463 million.
A version of this article originally appeared on our Fool Asia site. For more coverage like this, head over to Fool.hk.en.
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