Kappa parent Dongxiang embraces big growth number

China Dongxiang, which owns the Kappa brand rights in China, Macau and Japan, has recorded a 14.4 per cent increase in sales for the first-half year despite a restructure of its store network.

Sales totalled RMB772 million (US$111.67 million), while profit attributable to shareholders reached RMB481 million.

Kappa brand sales rose 10.7 per cent year on year with same-store sales rising in the mid- to low-single digits, despite a 20 – 25 per cent decline in forward orders and the closing down or upgrading underperforming stores.

E-commerce helped boost Kappa sales and brand awareness in China, where the company collaborated with platforms, such as Tmall, JD and VIP Shop to launch promotional campaigns during popular festive seasons, and intensified promotion of new products online.

The company’s Kappa Kids brand improved sales by 16.3 per cent and that now accounts for 7.7 per cent of China Dongxiang’s China regional revenue.

The company ended the period with 1439 Kappa stores, including 335 trading under the Kappa Kid’s banner.

Meanwhile, China Dongxiang’s Japan business continued to undergo reforms. The company says revenue from there grew significantly and its loss “shrank substantially” year on year.

China Dongxiang owns Phenix, Japan’s most popular ski brand, whose market share it is now trying to expand in China and Europe.