Li Ning Company Limited · HKEX:2331
Li Ning — Investor Presentation (July 2012)
21 slides from Li Ning's investor presentation, Jul 5, 2012
Slide 1: Corporate Presentation
LI NING COMPANY LIMITED 李寧有限公司 (Incorporated in the Cayman Islands with limited liability) (Stock Code: 2331) Corporate Presentation 5 July 2012 0
Slide 2: Presentation disclaimer
This presentation incorporates certain information stated in Li Ning Company Limited (the “Company”)’s announcement (the “Announcement”) dated 5 July 2012 as published on the websites of the Stock Exchange of Hong Kong Limited and the Company. This presentation should be read in conjunction with t
Slide 3: What we are announcing today
What we are announcing today Enhanced overall management strength and operational capabilities CBA sponsorship further builds affiliation with professional sports Go forward plan and short-term initiatives Achieve Long-term and Profitable Growth 2
Slide 4: Enhanced Overall Management Strength and Operational Capabilities
Enhanced Overall Management Strength and Operational Capabilities 3
Slide 5: ZHANG Zhiyong steps down as CEO, remains as Executive Director and Chief Advisor
ZHANG Zhiyong steps down as CEO, remains as Executive Director and Chief Advisor to Executive Committee LI Ning, Executive Chairman and Executive Director will focus on external affairs and relationships Jin-Goon KIM – Executive Vice Chairman and Executive Director will focus on internal affai
Slide 6: Recruiting talents to improve overall organization structure
Recruiting talents to improve overall organization structure Adding strong operational bench strength and making key senior management hires to fill the talent gap Support of a dedicated TPG operations team 5
Slide 7: Samuel SU joins the Board as Independent Non-executive Director
Samuel SU joins the Board as Independent Non-executive Director, bringing 20+ years retail experiences in China Chairman and CEO of the China Division of YUM! Brands, Inc. and serves as an executive director and the vice chairman on Yum!’s board of directors New board composition in line with
Slide 8: CBA Sponsorship Further Builds Affiliation with Professional Sports
CBA Sponsorship Further Builds Affiliation with Professional Sports 7
Slide 9: Exciting opportunity to sponsor the No. 1 sports league in China
Fastest growing and most popular Chinese sports league with 350 games played between November and March Mature commercial operations Statistics, such as its media coverage, TV viewership and number of spectators and the scale of sponsorships, attest to the strong commercial value of the CBA
Slide 10: Continuous commitment to sports investment
Chinese National Teams Key Sports for China National Teams Basketball Badminton Running Five gold medal teams, Main professional Dominating A key driving force of representing over 1/2 of basketball league in sponsorships including China’s running culture gold medals that China China nationa
Slide 11: Go Forward Plan and Short-term Initiatives
Go Forward Plan and Short-term Initiatives 10
Slide 12: Long heritage and close association with Chinese sports
2009: Began sponsorship of 1996: Sponsored the Chinese National Badminton Chinese delegation for Team, the fifth gold-medal team Atlanta Olympics on the Company’s national teams sponsorship roster 1984: Founder / chairman Li Ning won 6 gymnastics medals at the 1984 Olympics in Los 1990: Sponsored 20
Slide 13: No. 1 domestic sportswear brand & No. 2 overall
RECOGNITION FROM CONSUMER SURVEY: BRAND PREFERENCE RENOWNED ORGANIZATIONS BrandZ Top 50 Most Foreign Brand 1 32 30 Valuable Chinese Brands issued by Millard Brown, highest amongst all Chinese sportswear brands LI-NING 18 17 Foreign Brand 2 17 16 Ranked on “Hurun Most Valuable Chinese Home-grown Bran
Slide 14: China sportswear market size and penetration
CHINA SPORTSWEAR MARKET SIZE (US$ Billions) 40.0 CAGR: Low to mid teens 35.0 30.0 25.0 CAGR: 29% 20.0 15.0 10.0 5.0 0.0 2006 2007 2008 2009 2010 2011E 2012E 2013E 2014E 2015E SPORTSWEAR PENETRATION (US$ per capita, 2010) 134 88 72 15 China U.S. Japan U.K. Source: 3rd party research 13
Slide 15: Long term industry potential
Near Term Challenges Competition, over-expansion, excess channel inventory, cost pressure, wholesale model Long Term Drivers Urbanization Urbanization continues to move 1~2% rural population to urban area annually Purchase Consumers continues to purchase more as disposable spending and fre
Slide 16: Vision: Solidify LI-NING as the leading brand in Chinese sportswear
Improve store unit Focus on core brand economics sportswear in China Rationalize network Strategic investments in coverage through retail brand (e.g., CBA) profiling Make competitive products Strengthen outlets and with exciting designs and direct stores technologies, in shorter Manageme
Slide 17: Short-term and long-term initiatives
Focus on sell through and clearance of channel inventory Improve cost structure in product and operations Strengthen organization and execution capabilities Ongoing Now – 12 months initiatives Improve channel productivity, profitability, and performance Narrow focus to core products and domestic mar
Slide 18: Strengthening management
Strengthening management Partnerships between Chinese Sports icons and experienced operations leaders in China retail / consumer industry Integrating local market insights and world-class capabilities Partnership with TPG Deeply involved in strategic initiatives since April 2012 Experts
Slide 19: Unparalleled transformation expertise in China retail
China Grand NATIONAL NETWORK Automotive Group Before (2006) Now (2011) Annual Rev. RMB 9bn Annual Rev. RMB 64bn Pioneered roll up model in China auto industry Game Industry Source: Company website, company filing Changing Strategy Leader Daphne INITIAL / REPLENISHMENT ORDER Replenishment Initial Ord
Slide 20: Taking decisive actions to position Li Ning for success
Taking decisive actions and adjusting costs today to ensure that Li Ning is positioned for medium to long-term success Have identified the key challenges both inside and outside of the company, with plans in place to respond Confident that Li Ning will achieve a sustainable and profitable grow
Slide 21: Q&A
+ SS a a | Q&A