Investors, good morning. Welcome to Li Ning Company Limited's 2023 annual results announcement. Let me first introduce to you our management on stage. Executive Chairman and Joint CEO, Mr. Li Ning. Executive Director and Joint CEO, Mr. Qian Wei. Group Vice President and CFO, Mr. Zhao Dongsheng . In today's session, Mr. Zhao will first present the 2023 full year financial review, and then there will be a strategic direction introduction, followed by outlook, and then there will be a Q&A session. Let me pass the floor to Mr. Zhao.
Good morning, everyone. I am Zhao Dongsheng . Now, I will review our company's financial position in 2023 with you. In 2023, we actively carried out business layout, controlled opportunities and risks, and we made progress while maintaining stability. We finally achieved the following operating results. Financially, our revenue was up 7%, reaching CNY 27.598 billion.
Gross profit margin was 48.4%, remaining flat year-on-year. In a volatile market environment, we prudently controlled expense investment, while focusing on investment and layout to drive long-term business growth. Adding government subsidies and reductions in other non-operating income, the final net profit was CNY 3.187 billion. After deducting one time of income unrelated to operations, net profit was CNY 3.046 billion, net profit margin 11%. Overall funding position is sufficient. Operating cash flow rose 19.8% to CNY 4.688 billion. Average working capital to revenue ratio is 7.6%. Cash conversion cycle, 35 days, maintaining at a healthy level. The board of directors recommended final dividend of HKD 0.1854 per share, together with the paid interim dividend of HKD 0.3620 per share.
Full year dividend is HKD 0.5474 per share. Dividend payout rate increased from 30% in the same period last year to 45%, so we have increased shareholders' returns. In terms of operations, Li Ning's core brands, retail sell-through achieved year-on-year growth in all channels, in the low 10%-20%. Despite challenges faced by the retail environment, offline new product retail sell-through still achieved a growth of low teens. At the end of the year, Omni-channel inventory tag amount decreased by mid-single digit year-on-year. Omni-channel inventory to sales ratio, 3.6 months, which was further improved year-on-year at the end of the previous year. During the year, our revenue was up 7% year-on-year, thanks to the strategic focus on professional categories. Footwear revenue accounted for 49%, a stable and healthy level.
In a volatile market environment, Li-Ning brand adheres to the channel strategy of balanced development. The balanced proportion of wholesale and D2C helps us better balance the opportunities and risks between channels and finance, as well as operating funds and profit and loss. Overall, the proportion of channel sales remains stable and healthy. As the pandemic eases and people's lives gradually return to normal, online shopping becomes less popular. Proportion of e-commerce revenue dropped two percentage points to 29%. Direct retail revenue increases in share by five percentage points to 26%. In order to help dealers or distributors relieve terminal pressure and ensure further improvement of channel health, we reduced distributor shipments, reducing proportion of wholesale revenue by three points to 45%. For offline sales, sell-through, new products within six months, 87%, a healthy level.
For same-store performance in 2023, for all channels, same-store sales came down low single digits. Offline same-store sales increased low single digits. E-commerce same-store sales decreased high single digits. First quarter same-store pressure mainly came from the negative impact of the pandemic on the consumer side at the beginning of the year. In Q2 and Q3, offline stores gradually recovered, but consumption recovery was not as good as expected, causing same-store pressure to continue. E-commerce was affected by temporary changes in consumer channel choices after the pandemic, and same-store sales faced greater challenge. In Q4, based on the low base of the pandemic in the same period, same-store sales growth was relatively high. In particular, the outlet direct retail channel recovered very fast, which drove overall same-store growth quite significantly. Overall, weak consumption recovery environment still posed greater challenges to same-store growth.
In terms of channel development, in 2023, number of channels, number of POS totaled 7,668, an increase of 65 compared with same period in 2022. Li-Ning core brand stores decreased by 55. Li Ning Young stores increased by 120. In a challenging environment, Li Ning's core brand has expanded its core business areas and optimized store layouts. Although the number of core brand stores has slightly decreased, low single-digit year-on-year, total sales area of stores and average area of single store have increased a mid-single-digit year-on-year. Overall sell-through increased 10%-20% low range, and e-commerce sell-through achieved low single-digit growth. Offline sell-through increased low teens year-on-year. Average unit price or unit average selling price increased mid-single-digit. Sales volume increased high single-digit.
Li-Ning brand wholesale business, excluding international market and Li Ning Young business, annual revenue was slightly up 1% year-on-year. Number of stores was down 123. In order to ensure efficient collaboration of terminal business, we optimized product structure of professional channels and controlled business scale of professional channels. At the same time, for the sake of channel health, we reduced distributor sell-in in the second half of the year. Excluding professional channel shipments, wholesale revenue increased low single-digit. Year-on-year wholesale sell-through growth, low teens, much faster than the growth of wholesale revenue. In the long term, we'll continue to empower distributors and improve retail operation efficiency to promote healthy development and suitable growth of channels. Direct retail revenue was up 29% year-on-year. Number of stores was up 68.
As shown in the revenue change analysis chart, direct retail revenue growth was mainly contributed by new stores and same-store growth. Even though the consumption environment is not as good as expected, we strive to improve business performance of same-store sales through direct retail channels by continuously strengthening our retail operation capabilities, and we are opening new stores in core business districts to promote revenue growth. During the year, gross profit margin remained at 48.4%, flat year-on-year. The main factors are as follows: One, GP margin of direct retail channel. Due to the optimization of retail efficiency and improvement of discount, the group's gross profit margin increased 0.2 percentage points. Two, GP margin of e-commerce channels was down 0.8 percentage point due to intensified promotion competition and deepened discounting.
3, proportion of DTC channel has increased, driving GP margin to increase by 0.4 percentage points. 4, channel structure of other business units improved, driving GP margin to increase by 0.2 percentage points. The 7% revenue growth resulted in an increase in gross profit of CNY 867 million. In terms of expenses, we promote better long-term investment returns through strategic expense, investment, and control. Sales-related non-fixed expenses, such as direct retail store fees, platform competitions, logistics expenses, increased CNY 1.531 billion, mainly due to the expansion of direct retail stores in core business districts, which increased store expenses. Advertising and marketing expenses increased by CNY 217 million. Expense ratio was up 0.2 percentage points to 9%.
Increase in marketing expenses was mainly due to the increase in promotion and promotion expenses, driven by recovery of sell-through. In addition, increase in staff costs and R&D expenses, recovery of daily expenses, such as travel after the pandemic, depreciation of assets, and increase in taxes and fees caused by income growth, et cetera, led to increase in other platform expenses of CNY 213 million. Other income down CNY 65 million, due to decrease in other non-operating incomes such as government subsidies. Overall, the group's operating profit margin dropped 6 percentage points from 18.9% in the same period last year to 12.9%. Net profit margin dropped 4.2 percentage points from 15.7% in the same period last year to 11.5%.
Under strict channel inventory management, total channel inventory dropped by mid-single digit year-on-year in 2023. Omnichannel inventory turnover months is 3.6 months, and inventory age structure remains stable and at a healthy level. In the future, we'll continue to implement rigorous inventory management measures to ensure inventory turnover efficiency and inventory aging structure to be healthy in the long term. In terms of our inventory, in 2023, pre-provision inventory costs increased by 3% year-on-year. Compared with 7% revenue growth, the increase is reasonable and overall inventory is healthy. Our inventory age structure shows that proportion of new product inventory within 6 months is stable at 80%. Healthy age structure is an important foundation for supporting healthy and sustained growth of the business. We believe that through continuous improvement of merchandise efficiency and operational efficiency, there'll be more opportunities in the future.
Trade receivables, comparing with 7% increase in revenue, our pre-provision trade receivables increased by 6%. Trade receivable turnover days increased to 15, which is a reasonable and healthy level. As shown in the right chart, proportion of trade receivables within 90 days increased from 84% in the same period last year to 86%. Based on our past support for strategic partners and the joint effort of both parties, we optimized channel finance efficiency with our partners' management, and overall business situation is healthier. In the future, we'll continue to maintain strategic support for our partners to promote win-win between the both parties. In terms of working capital efficiency, our working capital remains at a healthy level. Working capital accounted for 8% of annualized revenue, giving us sufficient resources to drive business growth.
Our cash flow from operating activities was abundant, rising 19.8% to CNY 4.688 billion. Our net cash decreased by CNY 1.074 billion from same period last year to CNY 17.976 billion. Adequate cash reserve enables us to better manage pressure and risk in the face of complex retail environment, and also allows us to be in a better position to flexibly seize new business growth opportunities in the future. At present, the Chinese economy maintains basic trend of recovery, but it is also facing challenge of weak consumer demand and expectations. For 2024, we insist on stable operation and being practical. We believe that whole year revenue will grow, mid-single digit, and net profit, will be a low teen, or low single digit.
At the same time, we believe in the long-term development of China's sports, footwear and apparel industry, and we believe that, leading brand will continue to have growth momentum. That's all in my financial presentation. I will now defer to the chairman to introduce to you key strategic directions for 2023. Thank you.
Thank you. Good morning. I will make a review of our 2023 strategies. In 2023, with the gradual recovery of domestic economy and social activities, the consumer market will also enter the state of a gradual recovery, and the promotion of national policies, the national health awareness, has been significantly improved. The potential of sports consumption needs to be further released, and the sports goods industry has broad prospects for development. In 2023, the company focused on product quality improvement through increased investment in R&D to promote the simultaneous upgrading of product functionality and the fashion attributes. At the same time, the company paid close attention to retail operations and the store optimization to deepen the value of leading style experience.
The company continues to focus on the strategy of a single brand, multi-category and a diversified channel, plowing into professional sports, brand accumulation and product innovation, and integrating the elements of sports trends to provide consumers with professional and fashionable sports products through a multi-category, diversified channel matrix, and it strengthen the competitiveness of the brand and the products. In 2023, we are focused on the five core categories of running, basketball, fitness, badminton, and sports life, strengthen the brand's toughness with technological innovation, continuously improve product performance, strengthen the brand image of Li-Ning, and satisfy the growing sports needs of consumers.
The specialty category continued to gain momentum during the year, with the five core categories recording a 12% growth in omni-channel retail sales in 2023, and including a 40% increase in running and a 25% increase in fitness, driving the overall growth momentum. We deeply cultivated the market influence our professional running shoes, built a mature professional product matrix, and met various needs from entry to advancement. The Super Light and Red Hare and the Feidian exceeded 9 million pairs throughout the year. The cultivated sales volume of a core IP, Feidian 3 Challenger, exceeded 1.3 million pairs throughout the year, becoming a phenomenon IP in carbon plate running shoes. Relying on the technology platform, we created top speed running shoes, Feidian 3 Ultra, to help elite runners win many awards.
In February twenty-fourth, Feidian 3 Ultra helped the athletes created the fastest speed record in China's running shoes, and China's running shoes officially entered the 2:03 era . In the second half of the year, we launched a new professional cross-country products. Yueying cross-country running shoes family officially entered the professional cross-country track. This further enriches Li Ning's running shoes matrix, and it covers more consumer groups. Basketball category promotes professional attributes through technology platform. In the year, we launched an Yu Shuai Ultra professional basketball shoes, which are equipped with a new carbon core power assist system to break through the conventional midsole structure, and equipped with GCU ground control system to improve sports efficiency. In addition, Li-Ning brand has been committed to promoting the development of Chinese youth basketball.
It has reached a ten-year strategic cooperation with the China Middle School Sports Association on Chinese primary and secondary school students, campus, basketball, and has long supported the youth CBA. We look forward to gathering all forces to build a diversified and a professional growth platform and a stage for youth basketball. In terms of fitness, men's fitness further upgraded fabric technology to optimize the wearing experience, expand the core product categories to cover the clothing needs of variety of people and the scenes. Women's fitness insight, deep cultivation of products and the markets, and the introduction of women's exclusive IP, strengthened communication and contact with the women consumers. In the future, we'll continue to build high-quality fitness equipment for multiple sports scenarios with the functional technology as the core.
The category of sports life takes into account both the fashion and the sports attributes. Soft Go was launched this year to precisely focus on the daily needs of the public for walking and commuting. The sales of this series exceeded 1.5 million pairs this year. At the same time, we will continue to explore the culture of sports trends, create characteristic product through stories and original design with unique culture connotations, and use popular IP to strengthen the differentiation advantage of Li-Ning brand, attract young groups, and break through the fierce market competition. In terms of brand marketing, we relied on sports stars and professional events to strengthen brand exposure. In basketball, marathon, badminton, table tennis, and other fields, we continue to establish consumers' professional knowledge of Li Ning's professional products.
At the same time, we focus on upgrading and rejuvenating our brand image, attracting young consumers through cross-border, co-branding, linking up with entertainment resources and other means to strengthen our professional and youthful brand awareness, and further expanding the number of our consumer base. So that's all for the strategic direction of 2023, and let's welcome Qian Wei, CEO of the group, to introduce the operation results of the company.
Thank you. Good morning, investors. I'm Qian Wei. I'm going to make a summary of our operation for 2023. In 2023, we focused on the development strategy of our core business, and in the face of an uncertain market environment, we drove out our business operation in an orderly manner, and we realized the revenue of CNY 27.598 billion, in an increase of 7%.
This direct retail business in 2023 completed strategic channel layout and effective expansion, and also driving the business steady growth. At the same time, in order to effectively control risks and ensure the health of our dealers, distributors' operation, we took the initiative to reduce shipments to alleviate distributors' operating pressure. E-commerce was influenced by the industrial environment. The revenue scale was slightly increased. Regrettably, performance in 2023 fell out of our expectation, but the business is healthy and it sounds, and the risks are manageable. In terms of merchandising operation, we continue to strengthen our operation and the management capability to enhance the efficiency of the merchandise operation. We also continue to improve these low single digits.
By continuously strengthening the merchandising planning system and integrating product marketing and strengthen this merchandising retailing, we have continued to raise the discount rate of the new products to around 80% in three months. A slight improvement year-on-year, and maintained a healthy level of a sellout, and with the new product, a sellout rate of 70%-80% in six months. We also optimize our professional product matrix, and we are focused on the professional basketball shoes and the running shoes product matrix. We have achieved a total sale of over 12 million pairs of professional running shoes and basketball shoes in 2023. In the face of challenging market, the group has achieved a good level of inventory management through continuous and systematic management. Omni-channel inventory sales ratio of 3.6 months.
Inventory turnover efficiency is good. From the group's own inventory point of view, the company's inventory cost totaled CNY 2.68 billion, an increase of low single digits, in line with the group's inventory management expectation. As of the end of 2023, 18% of the inventory was at the 0-6-month range, 14% in the 7-12 months range, and 6% in the above 12-month range. So this are offline, and we will continue to maintain this manageable inventory level. And in terms of the direct sale. The offline business is stable. The overall offline sell-through is stable, and the same store with a small increase in the offline is a low single digit.
Through the improvement of the management and the retail operation, the overall discount trend is stable, and also the average unit price increased mid-single-digit, and the linkage rate maintained flat. By the end of 2023, we have realized a three-year high-level market channel layout, focusing on the core cities, core business districts, core business bodies, to achieve the expansion of large stores over 1,060, with an average area of 410 square meters. Focusing on channel expansion and optimization, we have carried out precise planning and key breakthroughs for the core commercial bodies across the country. The occupancy rate of stores has increased to nearly 90% in 2023, and the channel expansion and the single-store efficiency improved.
This in average store efficiency is also increased. We also accelerated the store image, promoted the remodeling of old image stores, and increased the use of ninth generation stores in the opening and remodeling of stores. A total of more than 230 new and upgraded stores have been opened, with average monthly store efficiency of more than CNY 500,000. In the future, focus on the improving operational efficiency. In terms of the e-commerce, we also faced challenges in 2023, and the overall online platform declined. This is the main reason the revenue didn't meet the expectation. On one hand, through the group integrated marketing, we put through this traffic.
On the other hand, we also reduced the retail discounts. At the same time, we formulated these differentiated business strategies and to drive more traffic and opportunities with a slight improvement in the business conversion rate year on year. In terms of Li Ning YOUNG, we continue to adjust commodity structure, build a professional sports product matrix, and through the improvement of product power, channel resource integration, to we achieve the retail indicator. And the overall sales increased significantly by 30%-40% in the mid-teens, and the same-store sales growth of 10%-20%. And by the end of the year, the number of Li Ning YOUNG stores reached 1,428. The average store efficiency was increased by 20%-30%.
In the supply chain, we have strengthened this basic capacity of the supply chain, continue to strengthen the quality awareness of all staff. We also strengthened the synergy with the front and the commodity management, enhanced the rapid response capability, reduced inventory risk. In terms of the shoes and apparel supply chain, we will focus on this streamlining of packaging and other means. At the same time, the group matches the high-quality supply resources and improve the layout of the supplier matrix, and formulate a three-year production capacity planning for strategic suppliers and increase the proportion of production capacity of strategic suppliers. We introduced the new supply resources of China Li Ning and Li Ning 1990 and other products.
In addition, we continue to transform and innovate to build a competitive advantage on upgrading and challenging the existing product development. And also, at the same time, we will promote the construction of the supplier information system based on the construction of Li Ning's own supply chain information system, build the entire supply chain upstream and downstream digital transformation. In the future, under the guidance of the group's vision and the core values, we will adhere to the strategy of a single brand, multi-category, diversified channel, and we'll focus on the strategy of consolidating and stabilizing the big goods business, represented by basketball, running, and sports life, remodeling China Li Ning and Li Ning 1990, to make full adjustments and the preparation for the release for potential and focusing on the segments of the race track to attract the women and other markets.
At the same time, we are deeply cultivating the market, building a multidimensional channel network and improve the efficiency of the high-level market. We hope through continuous adjustment, optimization, and deep cultivation, we can promote the enterprise to achieve long-term and sustainable growth. Thank you.