21 Aug 2025
Xtep’s 1H25 revenue was up by 7.1% YoY to Rmb6,838m, mainly driven by i) 4.5% YoY growth from core brand sales to Rmb6,053m as a result of the robust growth in online channels and increase in footwear ASP; and ii) 32.5% YoY increase from professional sportswear to Rmb785m as a result of strong offline retail growth with double digit SSSG. Overall GPM was down 0.1ppt YoY to 45.0%, with main brand down 0.3ppt YoY to 43.6% amid increasing competition within online channels, while S&M GPM down 1.6ppt YoY to 55.2% as higher apparel sales mix which carries a lower GPM compared to footwear. On the cost side, S&D ratio was up by 1.5ppt YoY to 21.7% in 1H25, driven by an 7.3% YoY increase in A&P to Rmb862m on strengthen marathon/running event sponsorships and brand upgrade for Saucony. Admin ratio was down 0.8ppt YoY to 9.4% on the reversal of share-based payment expenses and the decrease in staff costs, partially offset by 20.4% YoY increase in R&D expense to Rmb190m. As a result, excluding the net loss from discontinued operation in 1H24, 1H25NP surged by 6.4% YoY to Rmb914m. Interim-DPS was at HK$0.18, representing a stable payout ratio of 50%.