Investors, good afternoon. Welcome to Xtep International Holdings Limited's 2024 Annual Results Announcement Investor Presentation. I am Sophia, Director of Investor Relations. Let me introduce to you our management on stage. They are Group Chairman and CEO Mr. Ding Shui Po, Executive Director Mr. Yang Lubing, Group President Mr. Tian Zhong, Group CFO Ms. Dona Ding. In today's presentation, we'll conduct this presentation in Mandarin with English simultaneous interpretation. The management will first walk you through the 2024 annual results, and then there will be a Q&A session afterwards. Before you watch the video clip, perhaps we can invite Mr. Ding to deliver his speech first. Mr. Ding, please.
Honorable investor friends, good afternoon. Welcome to Xtep International Holdings' 2024 Annual Results Announcement. My name is Ding Shui Po. In 2024, macroeconomy still has a lot of uncertainty; however, there are still a lot of opportunities. There is the national fitness boom, the sports goods industry continues to outperform the overall retail industry. Running has become the most popular sport in China, with marathon races gaining popularity. Xtep core brand and Saucony demonstrated remarkable resilience in the running segment and continue to lead the group's market leadership, leading to healthy growth last year. Xtep core brand focuses on the mass market and has been focusing on running for many years.
Last year, in mainland China, in six major benchmark marathon races, we took the first place in terms of wear rate in all those marathons, surpassing all international brands, successfully influencing the public, and we have consolidated our group's position as the number one running brand in China. As a niche markets brand, Saucony focuses on the high-end market and has become the second growth curve for the group. In the past five years, CAGR of Saucony's revenue has exceeded 100%, and its revenue exceeded the JPY 1 billion mark last year. Through our brand operation model, we have made efforts in products, channels, and marketing to enable Saucony to continue its strong growth.
Looking into 2025, our strategy is very clear. We'll continue to focus on running and develop in the direction of professionalism and refinement. In this fast-changing retail environment, we are confident that we will take a proactive and pragmatic approach to enhance operational efficiency and deepen end-channel management in order to achieve high-quality growth to generate lucrative returns for investors.
Finally, in line with the group's diversified development, we are pleased to announce new appointments. Mr. Ricky Yeung has been promoted from CFO to Executive Director in charge of the group's global business strategy. Ms. Dona Ding has taken over the role of CFO, and she will bring her years of experience in brand operations and financial systems into full play in her new position. This appointment reflects the group's strategic plan for long-term development and management succession and further strengthens the management structure. Ricky and Donna will work very closely together to help the finance team operate efficiently and inject new energy into financial management to support the development of the group's multi-brand strategy and global business. Thank you all.
Thank you, Mr. Ding. Before our management presents results, please now enjoy our group's 2024 concluding video. Thank you.
推动更多的人跑起来，为强国的建设贡献自己的力量。
Now I will pass the floor to our group CFO, Donna, to walk you through our results. Thank you.
First of all, welcome to the Xtep's 2024 annual results presentation. Reviewing the year 2024, although the domestic economic development continues to be challenging, the group also achieved remarkable results in 2024.
For new brands, we have exceeded our revenue growth target in 2024. Professional sports segment's revenue grew more than 57%. Saucony grew by 60%, becoming the first new brand of Xtep Group to generate revenue of over JPY 1 billion. Page two of the PPT: Total group revenue increased by 6.5% to JPY 13.577 billion, of which Xtep core brand revenue was up 3.2% to JPY 12.327 billion. New brands, professional sports segments, Saucony and Merrell saw revenue growth by more than 57% to JPY 1.250 billion, operating profit up 9.3% to JPY 1.966 billion, group net profit up 20.2% to JPY 1.238 billion. Based on healthy cash flow, the Board of Directors recommended a final dividend of HKD 9.5 per share, together with the interim dividend of HKD 15.6 and special dividend of HKD 44.7. Payout ratio is 138.2%.
Page four, please. The profit and loss statement of the group: Total group revenue up 6.5% to JPY 13.577 billion. Gross profit up 10% to JPY 5.865 billion, faster than revenue growth. Gross profit margin up 1.4 percentage points year-on-year to 43.2%. Increase in gross profit margin was mainly due to significant improvement in Saucony's gross profit margin. SG&A expenses up 8.6%. The reasons for which are explained in detail later. Operating profit up 9.3% to JPY 1.966 billion. Net profit from continuing operations increased by 4.1%, less than the 9.3% increase in operating profit, excluding the reduction in loss on disposal of K-Swiss and Palladium in 2024.
This was mainly due to a one-time dividend tax, approximately JPY 75 million in 2024, as we repatriated more than JPY 1.5 billion from China to Hong Kong and repaid most of our Hong Kong bank loans. Excluding the impact of this JPY 75 million, actual net profit from continuing operations was up around 10%. The group's net profit was up 20.2% to JPY 1.238 billion. Net profit margin up 1 percentage point to 9.1%. Please turn to page five, our balance sheet. The balance sheet is in a healthy position. After excluding bank loans and convertible bonds, net cash was up 5.6% at JPY 985 million. Operating cash JPY 1.28 billion, more or less the same as net profit, very stable. We have 1.2 times of current ratio. In 2024, we paid out dividend, so net asset value was down 4.1% to JPY 3.24 billion.
Page six, overall working capital analysis. 87 days was the total working days turnover. Inventory turnover /'days decreased significantly by 22 days from the end of last year to 68 days, mainly due to divestment of K-Swiss and Palladium, which reduced amounts of inventory at the end of 2024. Payment turnover days decreased by 12 days from the end of last year to 101 days, mainly due to early Chinese New Year in 2024 and our early pickup and early repayment at the end of last year.
Receivables turnover days increased by 14 days to 120 days compared to the end of last year. This is mainly due to the fact that in the formula, the opening value includes KP's receivables, but revenue does not include KP's, pulling up the receivables turnover days. If we exclude effect of KP, turnover days is more or less the same as last year.
Please turn to page seven, business segment performance. First, Xtep core brand. Sales revenue up 3.2% to JPY 12.327 billion. For kids, there is a growth by around more than 20%. E-commerce growth by more than 20%. Gross profit was up 2.8% to JPY 5.15 billion. Gross profit declined 0.2 percentage points, mainly due to decline in apparel gross margin, but we are confident that this will be stable in 2025. Operating profit was JPY 4.295 billion, or 31.6% of revenue, up 0.5 percentage points year-on-year. The rise was mainly because of advertising and promotion A&P expenses, which rose 7.1%, accounting for 13.4% of revenue. The increase was mainly due to the fact that on January 1st, 2024, we acquired Saucony's brand company in China. All of Saucony's A&P expenses in 2024 are reflected in the group's expenses. R&D expenses were similar with last year, JPY 393 million, or 2.9% of revenue. Staff costs, as a percentage of revenue, rose slightly by 0.1 percentage points to 5.1%, mainly due to acquisition of Saucony China Company and the fact that most stores are D2C stores with corresponding increase in staff costs.
Other expenses up 13.5%. There are three reasons behind the increase. One, rising proportion of e-commerce sales revenue, which increased related platform fees and logistics and warehousing expenses. Two, increase in store rentals for Saucony's D2C stores. Three, relevant consulting expenses incurred to optimize the company's business operation system.
To summarize, in 2025, we will pay more attention to controlling expenses, and at the same time, in line with D2C strategy, we will strengthen the building of retail and inventory management capabilities and achieve effective growth through more refined operations. The above is our financial performance. Now I will pass the floor to Mr. Tien. Thank you.
Thank you, Donna. Honorable investors, good afternoon. Now I will walk you through the group's operations in 2024. The core of our group strategy is very clear. We will continue to focus on running. Xtep core brand will have a professional to mass influence strategy, offering more products with high value for money. For Saucony brand, it is positioned as a century-old running heritage brand. It focuses on elite segment of the high-end market.
For Merrell, it focuses on outdoor sports. For these three brands, they will continue to achieve good synergy to solidify Xtep's market status as the number one running brand in China to achieve sustainable growth. Xtep core brand has been following and focusing on the established strategy of running. In 2021, within three hours, wear rates in Xiamen Marathon for the first time surpassed international brands. In the past three years till 2024, in six major benchmark marathons in China, in terms of overall wear rate, we surpassed all other competitive brands, and we are number one in the market.
What is worth mentioning is that last year in Shanghai Marathon, for the first time, we surpassed international brands for the first time and became number one brand in wear rate. In 2024, if you look at marathon wear rate, we are working hard to implement the professional to mass influence strategy set three years ago, and we have achieved good results. If you look at brand synergy, just now I mentioned the six benchmark marathons in China, among which there are five marathons with global wear rates of more than 40% by Xtep core brand and Saucony.
There is efficient synergy of our group's running matrix, helping us to maintain leadership position in the running field. If you look at Xtep core brand, through our flagship operation model, we have established a momentum with professionalism to form professional to mass influence strategy and drive overall growth with our product matrix. In 2024, we upgraded the champion running shoe family by launching 160X, 6.0, and 6.0 Pro, and 260X and 360X new products. There are richer running shoes matrix to meet professional runners' needs. For channels of Xtep main brands, we continue to deepen retail management and continue to open large stores and close small ones to enhance customer experience.
As of December 31st, 2024, Xtep adult stores numbered 6,382, of which more than 65% are nine-generation stores. For Xtep kids in 2024, it's enjoyed very rapid growth. We have established the positioning of sports expert and cooperated with Tsinghua University and other universities to focus on healthy growth of young people and create differentiated competitive advantage. As of December 31st, 2024, number of Xtep kids stores was 1,584. Xtep core brand e-commerce. In 2024, e-commerce continued to lead our group's growth. Revenue was up 20% year-on-year and accounted for 30% of our core brand's revenue, especially on Douyin, WeChat video accounts, and [inaudible] and other emerging platforms.
We performed in an outstanding way, realizing growth rate of over 80%. For professional sports, Saucony, we clearly rationalized Saucony's positioning, a century-old running heritage, and it focuses on elite sports life. We, in this way, solidified the overall attributes. Since 2019, in the past five years, Saucony's CAGR growth exceeded 100%. In 2024, we exceeded JPY 1 billion mark, realizing a double harvest in terms of scale and profits, with continuous improvement in operational efficiency, and it became the second growth curve of the group. 2024 is the opening year of the brand tactics for Saucony. We have achieved very significant results. In terms of products, we continue to dig deep into running products, especially running shoes. There is technological innovation.
There are best-selling products like UltraSpeed, and then we have increased SKUs for apparel. In terms of products, Peng Yan was our spokesperson, and there is professional image focusing on the professional elites. We are strengthening the professional attributes. In terms of channels, we work in high-tier cities, core business districts to open big stores. In September and November, in Shenzhen, Wanxiangcheng, and Beijing, Heshengui, we opened new image flagship stores. As of December 31st, 2024, Saucony had 145 stores in China. For Merrell, it focuses on outdoor sports market and upgrades its core product line around outdoor scenario. It continues to work hard in e-commerce channel and improved its operational capabilities.
There was high growth in 2024. For sustainable development, we continue to break new grounds and achieve remarkable results. We are recognized by international authorities with MSCI ESG rating upgraded to A, making us the first Chinese sports goods company to receive such a rating. In 2024, we announced the 2030 ESG strategic framework, which comprehensively focused on defending the environment and creating a sustainable value chain and putting people at the center of everything we do. There is a 10-year sustainability plan for the group.
Let me summarize our strategy and outlook. For our strategy, we continue to focus on running. In the running field, we will form brand synergy. For Xtep core brand, there are three things we'll continue to focus on running to enhance the brand's mind share. Two, we will build a running flagship product matrix to achieve professional to mass influence. Number three, we'll increase investment in DTC business and deepen management of terminal retail channels.
For professional sports, three points. Saucony has clearly positioned itself as a century-old running heritage brand to build mind share of elite sports life and enhance the brand's potential. In 2025, Saucony had to enhance mind share and image. For channels, we strengthen retail channel management and continue to open directly operated flagship stores and new image stores in high-tier cities. For products, we'll deepen running shoes and strengthen or expand apparel and lifestyle products to broaden the product matrix. DTC strategy.
The group will increase investment in DTC strategy of our core brand, and Saucony brand will adopt DTC-based operation model. For our core brand DTC plan, in the second half of 2025 and 2026, we will recover, or we will recover 400 to 500 stores for the DTC model. For Saucony, in 2025 and 2026, we will increase investment in Saucony's brand and channel. DTC model transformation will effectively drive the group's growth in revenue, gross profit, and profitability. In China's sports industry, while it is steadily developing, we'll continue to consolidate our leading position in the running area, seize opportunities, and inject new momentum into China's sports goods industry. Thank you all.