Xtep International Holdings Limited (1368.HK) Bundle
From its founding in 2001 and Hong Kong listing in 2008 to operating an expansive network of more than 6,300 stores across 31 provinces and markets worldwide, Xtep International Holdings Limited has grown into a powerhouse in sportswear whose mission to "Make sports extraordinary" fuels product innovation, customer engagement and an expanding brand portfolio that since 2019 includes Saucony, Merrell, K‑Swiss and Palladium; guided by the vision to "Establish itself as a respected Chinese brand operator" and core values of Perseverance, Innovation, Integrity and Mutual Success, Xtep pairs a 10‑Year Sustainability Plan (2021-2030) with tangible progress - an A MSCI ESG rating in 2024 (its fourth consecutive improvement), a world‑class running science laboratory opened in 2018, over 2,000 patents granted as of December 2024, and social investments exceeding RMB 500 million reaching some 3,700 schools and over 570,000 students - signaling how strategy, governance and measurable outcomes converge to shape Xtep's next chapter in performance and purpose
Xtep International Holdings Limited (1368.HK) - Intro
Xtep International Holdings Limited (1368.HK), established in 2001 and listed on the Hong Kong Stock Exchange in 2008, is a leading Chinese sportswear company engaged in the design, development, manufacturing, sales, marketing, and brand management of footwear, apparel and accessories. The company operates a broad domestic and growing international footprint and has pursued brand diversification and sustainability as core strategic pillars.- Founded: 2001
- HKEX Listing: 2008 (Stock code: 1368.HK)
- Domestic retail footprint: over 6,300 stores across 31 provinces, autonomous regions and municipalities in China
- International expansion via brand acquisitions (2019) including Saucony, Merrell, K‑Swiss and Palladium
- ESG recognition: MSCI ESG Rating "A" in 2024 - fourth consecutive year of improvement
- 10‑Year Sustainability Plan: 2021-2030, targeting supply chain, environmental and social performance
| Indicator | Data / Detail |
|---|---|
| Establishment | 2001 |
| HKEX Listing | 2008 (1368.HK) |
| Retail Network | 6,300+ stores in China (31 provinces/regions) |
| Key International Brands (acquired/partnered) | Saucony, Merrell, K‑Swiss, Palladium (2019) |
| ESG Rating (MSCI) | "A" (2024) - fourth consecutive improvement |
| Sustainability Commitment | 10‑Year Sustainability Plan (2021-2030) |
- To inspire and enable consumers to live an active life by delivering innovative, high‑quality sports products and services.
- To balance commercial success with responsible manufacturing and social stewardship across the value chain.
- To be a globally recognized sports lifestyle brand rooted in China and respected for product innovation, design leadership and sustainable growth.
- To broaden global market share through multi‑brand strategy and targeted international partnerships.
- Innovation - continual R&D investment to improve performance, comfort and style.
- Quality - rigorous standards across design, materials and manufacturing.
- Customer centricity - retail experience and product ranges tailored to athlete and lifestyle needs.
- Sustainability - integrating environmental protection, responsible sourcing and labor standards into operations.
- Teamwork & Integrity - accountable governance, ethical conduct and collaborative culture.
- Brand portfolio diversification: leveraging international labels (Saucony, Merrell, K‑Swiss, Palladium) to accelerate overseas revenue and segment coverage.
- Retail scale: over 6,300 domestic outlets underpinning distribution reach and omnichannel capabilities.
- Sustainability roadmap: the 2021-2030 plan targets improvements in supply chain labor standards, emissions reduction, waste management and materials innovation - reflected in rising third‑party ESG scores (MSCI "A" in 2024).
- Governance & ethics: ongoing enhancements in corporate governance and business ethics that contributed to consecutive MSCI rating upgrades.
Xtep International Holdings Limited (1368.HK) Overview
Xtep's mission is to 'Make sports extraordinary,' a concise declaration that drives product design, brand positioning, and consumer engagement across domestic and international markets. The mission reflects Xtep's commitment to elevating the sports experience through innovation in footwear, apparel, and sports technologies, while cultivating broader participation in active lifestyles.- Core expression: deliver exceptional value in sportswear that makes sport memorable and accessible.
- Strategic alignment: prioritize leadership in running while diversifying into lifestyle, basketball, football, and kids segments.
- Customer impact: design, marketing, and retail decisions guided by enhancing user performance, comfort, and aesthetic appeal.
- Stability: mission has remained consistent, providing continuity across product cycles and geographic expansion.
- Product development centered on performance-driven R&D (running platform, proprietary foams, cushioning technologies).
- Brand collaborations and sponsorships to amplify sporty, lifestyle imagery and grassroots running communities.
- Retail and digital investments to create omnichannel experiences that make sports participation easier and more engaging.
| Metric | Value | Reference Period / Note |
|---|---|---|
| Total Revenue | HK$17.2 billion | FY2023 (preliminary/annual report) |
| Gross Profit | HK$8.9 billion | FY2023 - gross margin ~51.7% |
| Profit for the Year / Net Profit | HK$1.9 billion | FY2023 - net margin ~11.0% |
| Basic EPS | HK$0.45 | FY2023 |
| Retail Network | ~8,500 stores (China & overseas, retail + shop-in-shops) | End of FY2023 |
| International Revenue Share | ~25% | FY2023 - growth from SE Asia, Europe initiatives |
| R&D and Innovation Spend | ~3-4% of revenue | FY2023 - continued investment in running tech |
| Market Capitalization | ~HK$24 billion | Approximate value mid-2024 |
- Investment in running-focused product lines and proprietary technologies to improve performance metrics (weight, cushioning, durability).
- Expansion of running events, community programs, and sponsored teams to increase brand touchpoints and drive product trials.
- Omnichannel retail expansion to increase accessibility-store openings, upgraded digital channels, and marketplace partnerships.
- Strengthen running leadership: allocate R&D, marketing, and retail space to running collections to capture segment share growth.
- Portfolio diversification: extend into basketball, football, and lifestyle to broaden addressable market and smooth seasonality.
- Global expansion: scale distribution and brand-building outside Greater China to lift international revenue percentage (targeted growth shown in FY2023 results).
- Sustainability and quality: incorporate material innovation and quality controls aligned with consumer expectations and regulatory trends.
Xtep International Holdings Limited (1368.HK) - Mission Statement
Xtep's vision is to 'Establish itself as a respected Chinese brand operator,' anchoring a strategy that prioritizes brand-building, operational excellence and sustainable international expansion. The vision has remained consistent over multiple reporting cycles and drives resource allocation across product innovation, channel development and marketing investments to deepen consumer trust and loyalty.- Brand positioning: focused on premium sports and lifestyle segments while maintaining broad mass-market reach through value-for-money sub-brands.
- Operational focus: strengthening supply-chain efficiency, omni-channel retail, and data-driven category management to improve gross margin and inventory turnover.
- Internationalization: expanding presence across Southeast Asia, Europe and North America through partnerships, endorsements and regional distribution hubs.
- Revenue mix: continued shift toward branded sports performance and licensed product categories to capture higher ASPs (average selling prices) and margin expansion.
- Retail footprint: multi-year target to scale mono-brand retail points and digital channels in priority overseas markets while optimizing underperforming domestic stores.
- Brand equity metrics: increases in unaided awareness, net promoter scores and endorsement ROI guide marketing allocation to maximize lifetime consumer value.
| Metric | Value / Trend |
|---|---|
| Retail network (global mono-brand & authorized points) | Exceeds 6,000 outlets across China and international markets (multi-year expansion) |
| International revenue share | Rising to roughly ~15-25% of group revenue as overseas distribution and partnerships scale |
| Annual marketing & brand investment | Substantial year-on-year increases aligned with major partnerships and athlete endorsements (double-digit growth in campaign spend in peak years) |
| Gross margin trajectory | Targeting progressive improvement via product mix shift and supply-chain optimization |
| Net profit contribution from key categories | Performance footwear and licensed collaborations increasingly contribute a higher share of operating profit |
- Design and R&D: centralized design hubs and athlete-feedback loops shorten product development cycles and enhance performance credibility.
- Channel strategy: integrated e‑commerce, franchise, and self-operated stores to balance reach, margin and brand control.
- Partnerships & endorsements: targeted sports and lifestyle partnerships to accelerate recognition in new markets and consumer segments.
- ESG & compliance: improving sustainability and governance metrics to meet investor and consumer expectations for a responsible brand operator.
- Capital allocation prioritizes brand-building (marketing, sponsorships), retail productivity (store refurbishments, digital investments) and selective M&A/joint ventures for geographic reach.
- Key performance indicators reported to investors emphasize branded revenue growth, retail productivity (sales per point), international penetration and margin recovery.
- Public disclosures and investor presentations consistently link operational targets to the long-term objective of being a respected Chinese brand operator.
Xtep International Holdings Limited (1368.HK) - Vision Statement
Xtep International Holdings Limited (1368.HK) pursues a vision of becoming a leading global sportswear lifestyle brand that blends performance-driven innovation with mass-market accessibility. The company aims to elevate athletic performance, popularize running and sports participation, and expand internationally while maintaining sustainable, ethical growth.- Perseverance - building resilience across operations, retail networks, and brand expansion.
- Innovation - continuous product and technology advancement through focused R&D.
- Integrity - strict adherence to IP protection, compliance, and ethical conduct.
- Mutual Success - creating shared value for communities, employees, partners, and shareholders.
| Aspect | Concrete Evidence / Metric |
|---|---|
| R&D investment and facilities | Established a world-class running science laboratory in 2018 to enhance product performance and biomechanics research. |
| Intellectual property | Over 2,000 patents granted as of December 2024, underpinning product differentiation and legal protection. |
| Corporate social responsibility | Donations exceeding RMB 500 million to various regions and support for over 3,700 schools, benefiting more than 570,000 students. |
| Market identity | Listed on the Hong Kong Stock Exchange (1368.HK); focused on scaling international retail footprint and brand collaborations. |
- Perseverance - Strategic actions: sustained retail and e‑commerce expansion, channel diversification, and operational resilience planning.
- Innovation - Strategic actions: patent-backed product lines, laboratory-driven shoe and apparel development, and iterative material science improvements.
- Integrity - Strategic actions: active IP enforcement, regulatory compliance programs, and transparent governance practices.
- Mutual Success - Strategic actions: large-scale philanthropic programs, community sports initiatives, and partnerships with educational institutions.
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