Business news : China , Peak Sports Sees First Half Earnings Decline

Shares in Peak Sports Products, one of China’s largest sportswear makers,  closed down 5.8% to a six-week low of HIK$1.30 at the Hong Kong Stock Exchange today after the company warned on Friday that its profit for the first half would “decrease considerably” from a year earlier.

The company attributed to decline to “industry-wide destocking and a “sluggish economy,” which in turn hurt demand for new products.

Peak’s net profit in the first half of 2012 fell 43% from a year earlier to 239.7 million yuan, or $40 million, on sales that shrank 38% to 1.6 billion yuan.  For all of 2012, Peak’s profit dropped 60% to 311 million yuan, on sales that declined 38% to 2.9 billion yuan.

Looking for a sales boost in a tough industry, money-losing Li Ning, another Chinese footwear brand, said last Wednesday it had launched a “Mark Your Own Way: WOW!” meet-and-greet event as part of Miami Heat star Dwyane Wade’s 2013 China Tour.  Wade is the company’s “chief brand officer.”  Peak’s own “ambassadors” include Tony Parker of the San Antonio Spurs and Shane Battier of the Miami Heat. The two compete in China with Nike.

By Russell Flannery, Forbes Staff through  www.forbes.com