HONG KONG — Hosa International Limited (“Hosa Int’l” or the “Company” and, together with its subsidiaries, the “Group”, stock code: 2200.HK), one of the leading sports and healthy conglomerate in the PRC, today announced its interim results for the six months ended 30 June 2017 (the “period under review”).

FINANCIAL HIGHLIGHTS
– Revenue and gross profit for the six months ended 30 June 2017 were RMB658.8 million and RMB285.7 million respectively.
– Gross profit margin for the six months ended 30 June 2017 was 43.4%.
– Profit attributable to equity shareholders of the Company for the six months ended 30 June 2017 was RMB160.8 million.
– Basic earnings per share for the six months ended 30 June 2017 was RMB9.6 cents per share.
– The Board proposed to declare an interim dividend of HK3.9 cents (equivalent to approximately RMB3.3 cents) per share for the six months ended 30 June 2017.

During the period under review, the Group’s revenue and gross profit were RMB658.8 million and RMB285.7 million respectively, with a gross profit margin of 43.4%. Profit attributable to equity shareholders of the Company amounted to RMB160.8 million. Basic earnings per share was RMB9.6 cents per share. The Board proposed to declare an interim dividend of HK3.9 cents (equivalent to approximately RMB3.3 cents) per share.

In the first half of 2017, the Group continued to actively promote innovations in respect of branding segmentation, products structure, sales channels and retail outlets and the transformation and upgrade of the enterprise. Meanwhile, the strategy of sports and health industry has been implemented, which provides the Group with a greater room for development.

Continuous Optimisation of Product Structure

Currently, the Group’s main products are indoor sportswear, including fitness wear and swimwear. Others include revenue from sales of fabric and health products. Focusing on the sports and fitness demand of the target users, the Group will continue to optimise its product structure. During the period under review, the Group’s fitness wear, swimwear and others achieved an operating income of RMB229.5 million, RMB372.5 million and RMB56.8 million respectively. Equipped with nearly 20 years of experience in indoor sportswear research and development, rich professional knowledge and technological build-up, the Group has established a senior research and development team for indoor sports apparel that is familiar with the demand of indoor sportswear in China’s consumer market and thus maintained the market competitive edge of the Group’s products.

Steady Professional Brand Image Creation

The Group currently possesses two brands of products, namely Hosa and Water Cube. In order to meet the multi-faceted demand from both of the sports and healthy communities, and to create a professional image and strategic value of the Group’s brand in professional fitness channels, in the first half of 2017, as the titled sponsor of the Federation Internationale de Natation Association (“FINA”) 10 km Marathon Swimming World Cup, and Diving Series as well as the global partner of FINA, the Group continued to sponsor the 10 km Marathon Swimming World Cup and the diving tournament of FINA World Cup. The Group also continued to ramp up the promotion of and develop the independent sale channels for Water Cube brand apparel, and by leveraging its brand influence, high professional standard and price-performance ratio, the Group continued to expand sales in the mass swimwear market.

Hosa New Retail

In the first half of 2017, the Group strengthened the existing offline retail outlets. Meanwhile, to respond to rapid market changes, the Group improved its cooperation model with distributors by giving them a higher level of flexibility in marketing activities. In addition, the Group will actively promote “Hosa new retail” to integrate online and offline resources and sufficiently explore opportunities for “Internet +”. The Group is making proactive efforts in implementing cooperation with upstream and downstream enterprises in the industry (including mobile applications for sports and health).

Support for Talented Young Athletes

Focusing on natural, joyful and healthy lifestyle promotion through the participation in sports, the Group continued to carry out accurate and effective brand promotion and marketing campaigns which focused on its target customers, and brought about delightful and pleasant experience in sports and health to its consumers. For the continuous promotion and development of national fitness, in the first half of 2017, the Company continuously devoted more efforts in the sponsorships of professional swimming competitions, such as the “Hosa Cup” National Sports Academy Swimming Championships, the National Swimming Championships, the “Hosa Cup” Adolescents Swimming Championships in various provinces and cities, titled sponsorships for “Hosa Cup” Youth Diving Championships and other sports programs, as its key focus in nurturing talented sports players and athletes for the country, while fulfilling its social responsibilities by enhancing the physical health and health awareness of adolescents and improving the health of national citizens.

Looking Forward

In the second half of 2017, the Group will focus on the promotion of the following tasks: 1. to vigorously promote “Hosa new retail”, including implementation of online and offline sales integration, establishment of brand new O2O function, improvement in consumption experience of customers through ordering products via mobile applications and providing mobile payment service at its offline stores, as well as the exploration of consumers’ demand through big data analysis; 2. to implement cooperation with upstream and downstream enterprises in the industry (including mobile applications for sports and health), to integrate industry resources by flexible cooperative investment, and develop the sports and health industry; 3. to continue to develop new sports and health products, research on, develop and consolidate sports and health products and services to explore new business growth drivers based on consumers’ needs; 4. to continue to promote the titled sponsorship cooperation of various sports and fitness events, and enhance the professional image and reputation for the brand.

Mr. Shi Hongliu, Chairman of Hosa International Limited, believed “Looking forward, there will still be tremendous room for the growth of the PRC sports and health industry which enters a flourishing stage, and the growth of demand will remain strong. The Group will maintain its leading position in the existing sportswear business while promoting the implementation and enforcement of strategies with respect to sports and health industry in all aspects. In view of current situation, the Group and its controlling shareholder will fully utilize the leading position in sports and health products and services with the determination to implement the development strategy for the sports and health industry. We believe that the implementation of the Group’s sports and health industry strategies will form a foundation for the future development and create a huge room for the future development and growth of the Group as well as greater value and returns to the consumers and Shareholders.”