Li Ning Company Limited (HKEX: 02331) released its unaudited results for the six months ended 30 June 2026, showing modest top-line growth, resilient margins and a stronger cash position despite a tougher consumer backdrop.

Revenue and Earnings • Group revenue rose 2.80 % year on year to RMB 15.24 billion, driven by stable franchise sales (+1.70 %), solid direct-retail expansion (+4.20 %) and 5.10 % growth in e-commerce. • Net profit attributable to equity holders increased 4.54 % to RMB 1.82 billion, lifting net profit margin to 11.9 % (H1 2025: 11.7 %). • EBITDA declined 4.06 % to RMB 3.37 billion, translating to an EBITDA margin of 22.1 %. • Basic EPS improved to RMB 0.7040 (H1 2025: RMB 0.6743).

Product & Channel Mix • Footwear remained the largest segment at 54.4 % of sales, edging up 0.60 % to RMB 8.28 billion. • Apparel revenue jumped 11.80 % to RMB 5.80 billion, lifting its contribution to 38.1 % of total turnover. • Equipment & accessories fell 17.70 % to RMB 1.15 billion, now 7.5 % of revenue. • Within China, franchise distributors generated 46.0 % of sales, direct-operated stores 23.1 %, and e-commerce 29.7 %. Overseas markets represented 1.2 % of group revenue.

Profitability and Costs • Gross profit margin widened by 0.9 ppts to 50.9 %, reflecting channel mix optimisation and stable sourcing costs. • Selling & distribution expenses climbed 8.10 % to RMB 4.64 billion, or 30.5 % of revenue, as the company stepped up marketing around Olympic partnerships and category campaigns. • Administrative expenses decreased 7.27 % to RMB 0.72 billion (4.7 % of revenue) after a one-off goodwill impairment in the prior year. • Net finance swung to an expense of RMB 95.27 million (H1 2025: income of RMB 34.31 million) on lower interest income and higher FX losses. • Effective tax rate normalised to 25.8 % from 33.3 % a year earlier.

Cash Flow and Balance Sheet • Operating activities produced RMB 0.95 billion in net cash inflow; cash conversion cycle lengthened slightly to 35 days. • Cash and cash equivalents stood at RMB 13.00 billion, with total cash (including time deposits) at RMB 19.39 billion. The group remains debt-free and posted a debt-to-equity ratio of 34.1 %. • Inventory was essentially flat at RMB 2.70 billion, with a four-month channel inventory-to-sales ratio and healthy ageing profile.

Dividend The board declared an interim dividend of RMB 0.3512 per share, payable on 16 September 2026 to shareholders on record as of 8 September 2026.

Store Network As of 30 June 2026, Li Ning operated 7,579 points of sale (6,063 core-brand stores and 1,516 LI-NING YOUNG stores), reflecting a net reduction of 30 locations since year-end 2025.

Capital Expenditure and Use of Proceeds Construction of the Guangxi high-end supply-chain base continued; cumulative investment in related non-current assets reached RMB 2.12 billion. Of the HK$10.43 billion raised via the 2021 top-up placing, RMB 151.19 million remains earmarked for supply-chain infrastructure and is expected to be deployed by 31 December 2026.

Contingent Liability A HK$1.96 billion claim related to a disputed 2018 loan remains under litigation. Management, citing legal advice, maintains that the subsidiary involved has no repayment obligation and will contest the claim.

Post-balance-sheet Event On 14 July 2026, the company adopted a new share incentive scheme covering up to 5 % of issued share capital; no grants have yet been made.

Outlook Management will continue to execute the “Single Brand, Multi-categories, Diversified Channels” strategy, prioritising product innovation, omni-channel integration and supply-chain efficiency while leveraging partnerships such as the Chinese Olympic Committee and the newly signed Stephen Curry alliance to sustain growth momentum.