Topsports Intl Holdings (6110.HK): 1QFY26 trading update: muted recent sales trend; Neutral

研报英文原文证据摘录

Topsports Intl Holdings (6110.HK): 1QFY26 trading update: muted recent sales trend; Neutral

Goldman Sachs Topsports Intl Holdings (6110.HK)

earnings, and the company’s continuous commitment to shareholder return offers

downside support. We stay Neutral-rated as we believe the current share price has

priced in some of the aforementioned headwinds, plus the company’s DD% dividend

yield should provide some support to the share price/valuation.

Key takeaways from the quarterly update call

Sales: Mgmt believes the 1Q performance didn’t fully meet with internal expectations.

By business model, the direct sales decline was narrower compared to the wholesale

channel. By channel, DTC online slightly outperformed offline. The company continued

to optimize underperforming stores during this quarter, and will continue to review their

store portfolios.

Inventory: the company noted that the inventory yoy decline trends were similar to

topline trends, and therefore the inventory levels were broadly under control.

Blended discounts (online + offline) were wider yoy in May-quarter, but the magnitude

of the decline was slightly narrower than in 2HFY26, thanks to a more balanced

online/offline operation. The company believes that the overall environment remained

promotional and competitive.

Thoughts on outlook: as June-to-date demand yoy trends weakened further from

May-quarter, the company’s tone was cautious towards the near-term trends and

acknowledged the increasing challenges in achieving full year guidance. They plan to

continue to prioritize profits and margin into the rest of year.

Comments on Nike online: the company noted so far that they have not received any

official notice from Nike regarding termination of the online distributorship arrangement

in ML China.