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361 Degrees Announces Operational and Financial Highlights for the First Calendar Quarter Ended March 2011

2011-04-12 21:45 1270

HONG KONG, April 12, 2011 /PRNewswire-Asia/ -- 361 Degrees International Limited ("361 Degrees" or the "Company", together with its subsidiaries, the "Group"; HKEx stock code: 1361), one of the leading sports brand enterprises in China, is pleased to announce the following operational and financial highlights for the first calendar quarter ended 31 March 2011:

  • Same store sales for the first quarter improved by 14.7%
  • No. of retail outlets increased by a net of 194 to 7,457 as at 31 March 2011
  • Discounting at the retail level remained at recent levels of about 20%
  • Channel inventory was 3.3 times of monthly sales at 31 March 2011
  • e-POS connectivity now topped 3,017 stores

In this first quarter, the Company registered significant sales, especially in January, as distributors continued to collect their orders from the Spring/Summer and Winter Trade Fair held last August and April respectively. The Spring/Summer Trade Fair is the largest of the Company's three trade fairs in the year, and comprised a preponderance of apparel as well as a sizable footwear collection.

At the retail level, the first calendar quarter of 2011 demonstrated the continuing strong momentum from the previous quarter and sales were particularly robust in January and February. The month of March was typically much quieter, as demand tailed off after the Chinese New Year.

According to data uploaded from the e-POS terminals from 2,689 retail outlets in 17 regions, all of which had been in operations for more than 24 months, the average SSS growth for this quarter was 14.7%. Over 85% of these outlets showed a year-on-year improvement in sales, with growth noticeably higher in the smaller cities.

During this quarter under review, 194 stores, on a net basis, were added to the franchised network, bringing the end of March total to 7,457. Of these new additions, 53 are replacement stores, having relocated from other sites following the expiration of tenancies. Over 85% of these new stores were in Tier 3 or smaller cities.

As a result of the relatively solid retail sales, channel inventory dropped to 3.3 times of monthly sales, against 3.9 times at the end of December. The Company considers this to be a very healthy level as this included all stocks at both the distributors and retailers. The calculation was based on data obtained from the distributors in respect of 5,160 retail outlets, as measured against their average monthly sales.

The Company is also pleased to report that progress on its e-POS linkages to the retail outlets means that 3,017 stores as at 31 March 2011 now submit real-time sales data, and plans are on track to include the remaining franchised network by June 2012.

During this quarter, the Company bought back 900,000 of its own shares at an average price of HK$5.00 per share and which have subsequently been cancelled. The Company intends to pursue this Share Buyback scheme as interest rates remain relatively low, considering the prevailing market sentiment and the Company's own fundamentals.

For more detailed information, please contact Y F Chen at yuanfeng@361sportshk.com

About 361 Degrees International Limited

361 Degrees International Limited is one of the leading sports brand enterprises in China, possessing brand marketing, research and development, design, manufacturing, distribution and retail capabilities. The Group's products include footwear, apparel, accessories and equipment for sport and leisure uses. The Group has established an extensive supply chain management system through proprietary and sub-contracted manufacturing operations; and an exclusive distribution and retail network in China through distribution via authorized distributors.

For further information, please contact:

iPR Ogilvy LTD. 
Natalie Tam / Charis Yau / Summer Si / Janis Lai
Tel: +852-2136-6182 / +852-2136-6183 / +852-2136-6953 / +852-3920-7646
Fax: +852-3170-6606
Email: natalie.tam@iprogilvy.com / charis.yau@iprogilvy.com /
  summer.si@iprogilvy.com / janis.lai@iprogilvy.com 
Source: 361 Degrees International Limited
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