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China Daily Website

Peak Sport shares rebound after Monday plunge

Updated: 2013-07-09 19:27
By LI WOKE ( chinadaily.com.cn)

Shares of Peak Sport Products Co Ltd, one of China's largest sportswear companies, bounced back slightly on Tuesday after dropping 5.8 percent the day before, when the company issued a profit warning for the first six months.

Stocks of Peak closed at HK$1.31 ($0.17) on Tuesday, an increase of 0.77 percent. Its shares had fallen to a six-week low of HK$1.30 the day before. The Hong Kong-listed company attributed the decline to “industrywide destocking and a sluggish economy”.

In the first quarter, Peak closed more than 100 stores. Last year, the company’s profit dropped 60 percent to 311 million yuan ($50.7 million), while its sales revenue decreased 38 percent to 2.9 billion yuan.

Another high-profile Chinese sportswear company, 361 Degrees International Ltd, said it closed 96 retail branches during the fourth quarter last year.

Industry experts attributed the profit decline to high inventory levels and rising costs, including labor and rent.

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