As Anta's earnings leap, the company sets new goals
Updated 15:01, 03-Sep-2019
CGTN Global Business

China's largest sportswear maker Anta, currently the world's number three behind Nike and Adidas, wants to make it into the top two spots within five years. The company hopes the recently completed 5.4 billion U.S. dollars Amer acquisition can help its global ambitions gain traction.

The company's first half earnings were a high profile affair, with record sales of 14.8 billion yuan (about 2.07 billion U.S. dollars), up 40 percent year-on-year, outpacing industry peers. Market participants saw it as a rebuttal of short seller Muddy Waters’ recent reports on Anta. James Zheng, Anta’s president, explained why markets were not spooked by the reports.

"We followed all the requirements from regulations, we also already built very strong corporate governance in our company as a listed company. You can look at the results over the past 12 years, we have created tremendous value for our investors," Zheng said.

Anta president James Zheng. /CGTN Screenshot

Anta president James Zheng. /CGTN Screenshot

The latest earnings were the first time Anta broke out sales for the Fila brand. In 2009, Anta acquired Fila's China operations. That was the start of Anta's multi-brand strategy. Fila store sales now make up almost half of the total for Anta, despite having just one-tenth of the number of stores as the Anta brand. The recent acquisition of Amer Sports, with its high-end performance brands like Arc’teryx, Salomon and Sunnto, means the group has a bigger stable of brands, categorized under performance, fashion and outdoor sports.

"They (Amer brands) got a tremendous potential to grow in the Chinese market, we can use our existing Anta retail platform and also a sourcing platform to help these brands grow as fast as possible in China. On the other side, we also see a certain synergy on back of this support especially on the IT side," Zheng added.

While China's manufacturing exporters have taken a hit from the U.S.-China trade war, highly localized consumer companies like Anta have shrugged off the impact. China's top sportswear makers all enjoyed sales growths above 20 percent in the first half of 2019. Anta's half-year profit jumped 58.4 percent, to around 4.3 billion yuan (about 600 million U.S. dollars). Zheng said the trade war has had little impact on both sales and sourcing. 

"And also the products will be sold on a local base. So we don't see a lot of impact on our business. But on the other side, we don't want to see a huge influence on the overall economic situation. We still want to see the countries have kind of balance to make everybody happy," said Zheng.

China is the world's second-largest and fastest-growing sportswear market, thanks to consumers' pursuit of healthy and active lifestyles, government investment in sporting infrastructure and events, social media which lets people bond over fitness goals. 

(CGTN’s Cheng Lei also contributed to this story.)