361 Degrees International Ltd. · HKEX:1361
361 Degrees International — H1 2020 Earnings Presentation
32 slides from 361 Degrees International's earnings presentation, Aug 18, 2020
Slide 1: 361 Degrees International Limited
361 Degrees International Limited Stock code: 01361.HK August 2020
Slide 2: Contents
Financial Review Operational Review Contents Brand Building Outlook Q&A
Slide 3: Disclaimer
Disclaimer These presentation slides have been prepared by 361 Degrees International Limited (the “Company”) solely for us during its presentation held in connection with its unaudited interim results for the six months ended 30 June 2020 and may not be reproduced or redistributed. In particular, th
Slide 4: Focus to Achieve Success and Embrace the Trends
Focus to Achieve Success and Embrace the Trends Tide over the challenge of COVID-19 epidemic (“epidemic”) and maintain a stable development Undertake social responsibility and fight the epidemic with love Uphold the brand sportsmanship Sponsored the Asian Games for the 4th consecutive time Focus on
Slide 5: Financial Review
Financial Review
Slide 6: Financial Highlights
Financial Highlights For the six months ended 30 June RMB mn 2020 2019 Change Revenue 2,686.1 3,236.8 -17.0% Gross profit 1,015.8 1,322.7 -23.2% Operating profit 538.2 641.5 -16.1% Profit attributable to equity shareholders 302.0 367.4 -17.8% Basic EPS (RMB cents) 14.6 17.8 -18.0% Profitability Rati
Slide 7: Revenue and Gross Profit
Revenue and Gross Profit Revenue Mix Revenue GP (RMB mn) margin 6,000 45% 5,000 40.9% 40% 41.0% 37.8% 4,000 35% Footwear 3,000 43.7% Apparel 41.9% 30% 2,000 42.0% Kids’ Sportwear 3,236.8 2,686.1 12.0% 1.2% 1.2% 1,000 25% Accessories Others 0 20% 14.9% 1H2019 1H2020 1.0% 1.1% Footwear Apparel Kids’ S
Slide 8: Major Operating Expenses
Major Operating Expenses Selling and Distribution Costs Administrative Expenses For the six months ended 30 June For the six months ended 30 June RMB mn 2020 2019 Change RMB mn 2020 2019 Change A&P 197.7 274.9 -28.1% R&D 101.9 100.5 +1.4% E-commerce - commission and 26.4 42.5 -37.9% other service fe
Slide 9: Working Capital Cycle
Working Capital Cycle Working Capital Turnover Days Trade Debtors and Ageing Analysis days As at As at 150 RMB’000 30 Jun 2020 31 Dec 2019 Trade debtors 2,435,665 2,125,643 100 Less Allowance for doubtful debts (85,784) (50,847) 2,349,881 2,074,796 50 Bills Receivable 162,200 124,578 2,512,081 2,199
Slide 10: Liquidity and Capital Strength
Liquidity and Capital Strength Cash Flow For the six months ended 30 June RMB mn 2020 2019 Operating profit 538.2 641.5 Change in inventories 258.3 115.6 Change in trade and bills receivables (347.6) (535.3) Change in trade and other payables (282.7) 68.3 Change in deposits, prepayments and (164.4)
Slide 11: Liquidity and Capital Strength
Liquidity and Capital Strength Financial Resources As at 30 Jun 2020 As at 31 Dec 2019 RMB’000 Pledged bank deposits 119,638 230,675 Deposits with bank with maturities > 3 months 3,000,000 3,000,000 Cash and cash equivalents 3,206,005 3,422,295 Total cash 6,325,643 6,652,970 Bank loans 211,772 111,1
Slide 12: Balance Sheet Highlights
Balance Sheet Highlights RMB mn As at 30 Jun 2020 As at 31 Dec 2019 Change Current assets 10,512.8 10,659.9 -1.4% Current liabilities 4,652.0 2,809.0 +65.6% Net current assets 5,860.8 7,850.8 -25.3% Equity attributable to owners of the 6,568.8 6,322.5 +3.9% company Net asset value per share (RMB) 3.
Slide 13: Operational Review
Operational Review Ashton EATON Record-holder in the Men’s Decathlon
Slide 14: 361 Sales Overview
361 Sales Overview Global Sales Network The Group has 6,248 point-of sales across the world, in which 5,289 point-of-sales are in mainland China. Point-of sales in mainland China: In terms of city distribution, point-of sales in the first and second-tier cities accounted for 24.3%, and point-of sale
Slide 15: Kids' Sportswear Sales Overview
Kids’ Sportswear Sales Overview China Sales Network The Group has 1,702 point-of-sales for kids’ sportswear in China. In which: In terms of city distribution, point-of-sales in first and second-tier cities accounted for 29.9%, and point-of-sales in third-tier or lower cities accounted for 70.1%; in
Slide 16: Consumption Experience Upgrade
Consumption Experience Upgrade ◼ Upgraded store professional image • The first 9th generation image store of 361 opened in June 2020; • In 1H2020, 361 Kids’ sportswear upgraded 46 stores to the brand- new 4th generation store; • Higher brand recognition for the latest store image and richer portfoli
Slide 17: E-commerce
E-commerce ◼ The sales volume has grown steadily, and the sales strategy closely follows the trend • In 1H 2020, the revenue from e-commerce sales of web-exclusive products was RMB315.8 million, accounting for 11.8% of the group's total sales revenue; • Through the 361 official website and renowned
Slide 18: Brand Building
Brand Building Katie Zaferes ITU World Triathlon Series Championship
Slide 19: Brand Positioning
Brand Positioning High-end Market Casual Professional Fashion Sports Mass Market
Slide 20: Top-tier Sports Event Sponsorship
Top-tier Sports Event Sponsorship Sponsor the 2022 Hangzhou Asian Games, building the future with passion • On 21 June 2020, 361 sponsored the Asian Games again and became the official partner of sports apparel of the 19th Asian Games in Hangzhou 2022; • Since the Guangzhou Asian Games in 2010, it h
Slide 21: National & Professional Sports Team Resources
National & Professional Sports Team Resources Fully supported 17 national & professional sports teams ◼ National and Regional Sports Teams • China National Swimming Team • China National Biathlon Team • China National Synchronized • China National Nordic Biathlon Team Swimming Team • China National
Slide 22: Outstanding Spokesperson Resources
Outstanding Spokesperson Resources Contracted with 27 top-tier athletes and celebrities as spokespersons ◼ Basketball Player ◼ Triathlete ◼ Track and field all- ◼ Marathon runner ◼ Swimmer around athlete Katie Zaferes Li Zicheng ITU world triathlon series The top athlete in Asia and championship Chi
Slide 23: Premium IP Crossover Resources
Premium IP Crossover Resources Crossover collaboration resources empowers brands Integrating fashion trends with professionalism • Continued to cooperate with many classic IPs and launched series of products such as Gundam, PepsiCo, Minions, Captain Tsubasa, and etc.; • Combining the professional at
Slide 24: R&D and Design
R D and Design ◼ The Group has obtained 369 patents ◼ In 1H2020, R&D expenses accounted for 3.8% of the Group’s revenue ◼ The Q3 technology platform for shoe sole to support the performance improvement of full range of products 2020 Innovation Path Appearance Upgrade Configuration Upgrade Category E
Slide 25: 361º Kids Brand Building
361º Kids Brand Building ◼ Strengthened youth ◼ Quality IP and ◼ Expanded the use of anti- football resources spokesperson resources microorganism technology • Official partner of Evergrande Football • IP crossover with sports star YANG Xu • Cooperated strategically with China State School and Capta
Slide 26: Take Responsibility and Fight the Epidemic Together
Take Responsibility and Fight the Epidemic Together ◼ Take Responsibility, One Extra Degree of Passion • Donated RMB10 million worth of cold-weather and sports clothing to Hubei Province which was severely affected by the epidemic. ◼ Respond quickly to fight the epidemic together • On 30 January, th
Slide 27: Outlook
Tan Weiwei Famous Chinese pop singer Outlook
Slide 28: Favourable Government Policies
Favourable Government Policies A - Explore E – Sports policies continue to be refined • 1995-2010 Sports Industry Development Outline • Action plan to further promote sports consumption • Implementation Plan for Further Optimizing Supply to Promote the Stable Consumption Growth and Facilitating the
Slide 29: Favourable Factors to Drive Industry Development
Favourable Factors to Drive Industry Development 2014-2024 Market Size of China’s Sportswear Industry ◼ The prevention and control of the epidemic has become normal, the pent-up demand of the sports industry is (RMB bn released at an accelerated rate, and the long-term overall upward trend of the sp
Slide 30: Sportswear Market Continues to Grow
Sportswear Market Continues to Grow Sporting goods growth (by performance) Sporting good growth (by category) 29% 26% 25% 22% 17% 18% 22% 15% 13% 14% 13% 11% 20% 21% 21% 15% 16% 14% 19% 12% 12% 19% 19% 2% 10% 9% 18% 16% 15% -3% 13% 50% 13% 12% 49% 12% 49% 10% 9% 10% 46% 47% 9% 45% 6% 45% 5% 45% 45%
Slide 31: Rising Sports Participation in Public Community
Rising Sports Participation in Public Community ◼ Sports Participation Rate by Age Group in China 26.8% 25.3% 25.2% 23.8% 23.4% 22.2% 21.3% 21.2% 19.5% 18.8% 18.7% 18.2% 18.0% 16.7% 14.9% 14.7% 14.0% 13.7% 12.4% 12.2% 10.8% OVER 19 20-29 30-39 40-49 50-59 60-69 70 AND OVER 2014 2018 2023E ◼ Number o
Slide 32: Q&A
Aron Gordon An international basketball super star Q&A
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