China Lilang posts $664m profit in 2020

Its 2020 performance, however, is down by more than 30% YOY.

China Lilang Limited recorded a net profit of $664m (RMB557m) in 2020, reflecting a 31.4% decrease compared to the previous year.

The company's revenue decreased 26.7% to $3.19b (RMB2.68b), whilst profit from operations slipped 33.5% to $776m (RMB651m). Operating profit margin was down 25 percentage points to 24.3%.

“In face of the complex and volatile retail market, China Lilang adopted flexible strategies and promoted the new retail business to give full play to complementary advantages of online and offline,” said Wang Dong Xing, chairman and executive director of China Lilang.

“The group also strived to keep the channel healthy and decisively cancelled some of the spring and summer orders while strictly controlling pre-orders for the fall and winter collections,” he added.

China Lilang fast-tracked its new retail business and mounted promotional and marketing strategies online, in response to the challenges of the pandemic.

As a result, the group attracted more customer traffic to its online stores, increasing their online store sales by more than 1.2 times YOY.

The group also set up stores on WeMall Mall for its smart casual and core collections, promoting its brand on social media. This raised sales efficiency per store.

During the year, China Lilang converted its smart casual collection to direct retiling from consignment model. It also closed underperforming stores and opening ones in selected quality shopping malls.

By the end of the year, Lilanz had a total of 2,761 retail stores, representing a net decrease of 54 stores. Of this, 807 were in shopping malls or 29% of the store count.

“The total retail sales of LILANZ products resumed growth in the second half of the year, and total retail sales growth in the fourth quarter reached 10-15%, primarily benefiting from the nationwide cold weather,” Wang said.

“Both the inventory level and its ageing have improved. During the year, the group launched a number of brand promotional campaigns, which won multiple awards from the advertising industry, further enhancing LILANZ's brand awareness and reputation,” he added.