HONG KONG: Fujian-based Anta Sports, the largest sportswear retailer on the mainland by market value, posted better-than-expected first-half profits as a result of network expansion and stronger brand presence, according to the company's statement filed at the Hong Kong Exchange yesterday.

Net income for the first six months ended June 30 rose 40 percent to 608.3 million yuan, or 0.2443 yuan a share, from 434.3 million yuan, or 0.1744 yuan, a year earlier, the company said. Turnover increased 27.7 percent to 2.8 billion yuan, while sales volumes rose 26.6 percent and 22 percent to 16.4 million pairs for footwear and 25.7 million items for apparel, respectively.

Credit Suisse said earlier in a research note that Anta's first half profit could increase by at least 30 percent. The interim profit, almost doubling that of 2007, boosted its prices by 0.17 percent to HK$11.5 while the broad Hang Seng Index shed 3.62 percent yesterday.

The Hong Kong-listed retailer posed a much stronger presence in the past half year by gaining sponsorship of the "2009-2012 Sportswear Partner of the Chinese Olympic Committee" and the "2009-2012 Official Partner of the China Sports Delegation". During the agreement period, Anta Sports will sponsor sportswear for the China Sport Delegation when they participate in 11 important international competitions, including the Guangzhou 2010 Asian Games, the Vancouver 2010 Olympic Winter Games, and the London 2012 Olympic Games, the company said.

Anta said last week it agreed to buy the Fila sports business on the mainland from Belle International Holdings Ltd for as much as HK$600 million to expand into the high-end sports shoes and apparel retail market.

It is to further develop the newly tapped kids' sportswear market and trendy youth-oriented apparel lines, the company said.

In the meantime, the company added 462 stores on the mainland in the first half, increasing the number of outlets to 6,129 as of June 30 amid growing domestic consumption in which the clothing sector rose 18 percent year-on-year, according to the statement.

The mainland sportswear market has always been competitive, particularly in the past few years, as a number of new entrants have sought to aggressively expand their distribution networks and share of the business.

Anta's rival Li Ning is expected to report interim result on August 26, which analysts say will see at least 30 percent growth.

(HK Edition 08/18/2009 page4)