Li Ning Co Ltd, China's biggest sports goods producer, said on Wednesday that its revenue in 2008 increased by 53.8 percent year-on-year to 6.69 billion yuan, driven by the Olympic Games held in Beijing.
It posted a net profit of 721 million yuan ($105.41 million), a 52.3 percent increase compared to 2007, the Hong Kong-listed company said in its annual financial report.
The company said the Beijing Olympics greatly upgraded the brand value of Li Ning. The Chinese national gymnastic team, diving team, table tennis team and shooting team the brand sponsored won 27 gold medals out of the 51 golds won by China overall.
The brand also sponsored foreign national teams such as the Spanish and Argentine men's basketball teams, which won silver and bronze medals respectively.
In 2008, the company opened 1,012 more retail stores, of which 80.6 percent were in second- and third-tier cities. Meanwhile, stores in first-tier cities such as Beijing and Shanghai declined from 352 in 2007 to 310 last year. Currently, Li Ning has 6,245 retail stores in total.
Anta, a major domestic competitor of Li Ning, said in financial report that its business revenue increased by 55 percent to 4.63 billion yuan in 2008. Anta opened 951 new retail stores last year, reaching 5,667 in total. These also focus on second- and third-tier cities. Competition between the two is thus expected to increase.
Li Ning predicted its profit in 2009 may be influenced by uncertainty in the macroeconomy and the rising cost of raw materials and labor.