CHINA: Li Ning H1 profit hit by reforms
Sports wear company Li Ning said its performance in 2011 would continue to be impacted by ongoing reforms to the business, including revitalisation of the Li Ning brand and improvements to distribution.
The Chinese company said the reforms were currently in the early stages, meaning that operating performance and financial indicators would be affected “in the near term”.
Group revenue in the first half of the year was estimated to be down 5%, with the Li Ning brand said to be experiencing “a degree of slowdown” and other brands flat.
Retail same store sales were up in the low single digits, but order values from the Li Ning Brand Products Trade Fair for the fourth quarter, ending in June 2011, were up by more than 5%, with average retail prices for apparel and footwear rising by over 10%.
Li Ning said the margin of pre-tax profit was likely to decline by about eight percentage points from 17.6% for the same period last year.
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