Xtep's Revenue Grows in 2023 Driven by Running Shoe Business, Initiates International Expansion.
Xtep(1368:HK)'s revenue for 2023 reached CNY 143.46 billion, marking a 10.9% year-on-year growth. The main brand revenue accounted for CNY 119.47 billion. In terms of net profit, Xtep achieved CNY 10.3 billion, reflecting an 11.8% increase.
Ding Shuibao, Chairman and CEO of Xtep, attributed the growth to the company's leading position in the running shoe industry. Xtep's entry into marathon projects in 2007 and the subsequent launch of the 160X series in 2018 have contributed to the brand's presence in major marathon events. The recent release of the 360X running shoes further expands Xtep's product range.
Despite intense competition in the running shoe market, both domestically and internationally, with brands like Nike, Adidas, and emerging niche brands, Xtep has diversified its development. In 2019, Xtep entered a joint venture agreement with Wolverine, expanding its multi-brand business. Additionally, a strategic partnership with Hillhouse Capital in 2021 aimed to develop global operations.
Amidst the competitive landscape, Xtep's acquisition of Saucony and Merrell's business in China has proven to be profitable, with Saucony becoming the first new brand to achieve profitability within Xtep's multi-brand portfolio in 2023.
Looking ahead, Xtep remains strategically focused on the running sector, aiming to solidify its position in the Chinese market and expand its running ecosystem. As a domestic brand providing high-value products to the mass market, Xtep will continue to strengthen its research and development capabilities and optimize product performance. The group plans to offer product series tailored for Chinese consumers, thereby expanding the business scope of Saucony and Merrell and exploring global market opportunities.
Currently, in addition to its own brand, Xtep International possesses four international sports brands, forming a brand matrix that covers three major areas: mass sports (Xtep), professional sports (Saucony, Merrell), and fashion sports (Globuswave, Paladin). Simultaneously, the company is gradually penetrating the Southeast Asian running community through cross-border e-commerce platforms, aiming to achieve a broader overseas market layout.
As of the time of writing, Xtep's stock is priced at HKD 4.88 per share, with a total market value of HKD 12.89 billion.