A huge loss of over 2 billion! The former "shoe king" Guirenniao announced that it will withdraw from the sports footwear and clothing business
On the evening of September 22nd, the former "shoe king" noble bird announced a big move!
ST Guiren has announced that the company's board of directors plans to optimize and adjust its business operations, with the grain business as the company's main future development direction, prioritizing and focusing on expanding and strengthening the grain business, and gradually withdrawing from the sports shoes and clothing business.
In recent years, the competition in the sports footwear and clothing industry has become increasingly fierce, and ST Guiren's sports footwear and clothing business revenue has decreased and continued to suffer losses. In the first half of the year, the company's net profit and loss scale further expanded. ST Guiren stated that the "Guirenniao" brand is facing significant development pressure.
As of the close on September 22, ST Guiren's stock price was reported at 1.84 yuan per share, with a total market value of 2.9 billion yuan.
Proposed withdrawal from sports footwear and clothing business
The announcement shows that ST Guiren currently has three major business systems: sports shoes and clothing business, investment and agency business, and grain business.
![A huge loss of over 2 billion! The former "shoe king" Guirenniao announced that it will withdraw from the sports footwear and clothing business](https://a5qu.com/upload/images/215a919c534dcf2fa7f498c9d6ba8985.png)
In view of the current and future internal and external opportunities and challenges faced by the company, in order to achieve a focus on its main business, the board of directors of ST Guiren plans to adjust the company's business operations, with the grain business as the main direction of future business development, prioritize and focus on expanding and strengthening the grain business, and gradually withdraw from the operational footwear and clothing business.
ST Guiren stated that since the judicial restructuring, the company's sports shoes and clothing business has experienced a decline in revenue and continuous losses, and market competition has become increasingly fierce. The company will dispose of brand assets such as "Guiren Bird" and "Prince" and other sports shoe and clothing related assets through methods such as authorization, licensing, sales, and leasing, and gradually withdraw from the sports shoe and clothing business.
Public information shows that ST Guiren is an established sports apparel brand. In 2014, the company went public on the Shanghai Stock Exchange under the halo of being the first A-share sports brand.
In 2021, ST Guiren embarked on the path of judicial restructuring due to business and debt crises. The company introduced Heilongjiang Taifu Jingu Network Technology Co., Ltd., which is mainly engaged in grain trade, as the restructuring investor, becoming the second largest shareholder of the company with a shareholding ratio of 20.36%. And establish a wholly-owned subsidiary, Shanghai Michenglai Trading Co., Ltd., mainly engaged in grain trade business, mainly engaged in agricultural and sideline products such as soybeans and corn.
With the continuous increase in the proportion of the company's grain income, ST Guiren has gradually formed a dual main business model of "sports shoes and clothing+grain trade". In the first half of 2023, the company's sports shoes and clothing business achieved a revenue of 232 million yuan, a year-on-year decrease of 19.51%; The grain business achieved a revenue of 342 million yuan, a year-on-year increase of 43.51%.
Continuous losses in performance
![A huge loss of over 2 billion! The former "shoe king" Guirenniao announced that it will withdraw from the sports footwear and clothing business](https://a5qu.com/upload/images/beed78941ae640878d47d11c10ec7ec5.png)
It is worth noting that ST Guiren's performance is currently under severe pressure.
From 2018 to 2022, ST Guiren's annual net profit attributable to the parent company suffered four losses, with a cumulative loss exceeding 2 billion yuan. Among them, the net losses from 2018 to 2020 were 686 million yuan, 1.096 billion yuan, and 382 million yuan respectively, and the net loss in 2022 was 9.4137 million yuan. In 2021, due to the completion of bankruptcy restructuring, the company confirmed a debt restructuring income of 1.222 billion yuan, and achieved a net profit turnaround for the year.
ST Guiren's net profit performance from 2018 to 2022. In the first half of this year, ST Guiren was still in a loss state, with a net loss attributable to the parent company of 18.1446 million yuan, an increase in year-on-year losses, and a net loss of 17.375 million yuan in the same period last year.
ST Guiren stated that due to the development and changes in the sports footwear and clothing industry, as well as the rise of niche sports brands, small and medium-sized sports footwear and clothing brands represented by "Guiren Bird" are facing significant development pressure.
According to Euromonitor data, in 2021, the top five players in China's sports footwear and apparel market share were Nike China, ANTA, Adidas China, Li Ning, and SKECH China, with shares of 25.2%, 16.2%, 14.8%, 8.2%, and 6.6% respectively, accounting for over 70% of the total, showing an increasingly obvious pattern of head concentration.
ST Guiren stated that based on the market share data mentioned above and the revenue projections released by Anta and Li Ning, the market share of the company's "Guirenniao" brand was estimated to be 0.28% -0.31% in 2021. At present, the number of retail terminals for the "Guirenniao" brand has decreased from 2358 in 2019 to 1584 in the first half of 2023.
![A huge loss of over 2 billion! The former "shoe king" Guirenniao announced that it will withdraw from the sports footwear and clothing business](https://a5qu.com/upload/images/28425a646d41f7045a9695e7d9e59154.jpg)