Xidelang

Financials

Quarterly Report For The Financial Period Ended 30 September 2017

Financials Archive

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Condensed Consolidated Statement Of Comprehensive Income (Unaudited)

Income Statements

Condensed Consolidated Statement Of Financial Position (Unaudited)

Financial Position

Analysis of Performance

Analysis Of Performance

Revenue

Our Group recorded total sales of approximately RMB145.0 million and RMB418.3 million respectively during the current quarter and financial period under review, representing a growth of approximately 16.3% and 18.5% respectively as compared to preceding year corresponding quarter and period.

The improved sales performance was primarily volume-driven, contributed by the increased sales of sports shoes in line with the gradual recovery in market demand. Our Group recorded increase in quantities sold for both the own-branding manufacturer division and the ODM production division, as illustrated below:

(a) Total volume sold for our Group's own-branding sports shoes during the current quarter and financial period under review Analysis Of Performance

(b) Total quantities sold under ODM production during the current quarter and financial period under review

Analysis Of Performance

Profitability

Our Group's profitability for the current quarter and financial period under review demonstrated an overall improvement as compared to the preceding year corresponding quarter and period, in line with the enhanced sales performance.

Gross profit stood at RMB25.8 million and RMB72.0 million respectively for the current quarter and financial period under review, increased by approximately 29.3% and 21.6% as compared to the preceding year corresponding quarter and period.

Backed by the improved operating profit and active monitoring of costs, our Group's profit after tax for the current quarter and financial period under review rose to RMB5.7 million and RMB13.8 million respectively, reporting over 100% increase as compared to preceding year corresponding quarter and period.

Outlook and Prospects

Demands for sportswear within the China market are showing positive growth momentum, backed by the following favourable factors:

  1. Active rebalancing measures and policies by the Chinese Government to shift towards a more consumption-based, service-orientated growth model. Sports industry has been identified as one of the core areas, where the Chinese Government has formulated policies and measures to accelerate the development of the domestic sports industry;
  2. Huge and rising population within China, complemented by an increasing disposable income per capita; and
  3. Increasing popularity of sports and rising participation levels, in line with the growing awareness on healthy lifestyle.

Our Group is cautiously optimistic that the prospects for the sportswear industry will remain promising, and expects the demands for sportswear within the domestic China market and the global markets to be on positive growth momentum in the medium and long term, in line with the steady economic growth in China and improving economic outlook and stronger activity for the advanced economies.

Barring any unforeseen circumstances, our Group expects the financial performance for the financial year ending 31 December 2017 to remain positive and showing growth.