Financial Services Association, May 6 (Reporter Chen Kang) The established shoe company Red Dragonfly (603116.SH) turned a loss into a profit last year. The company mentioned at today's results conference that the main reason for the increase in performance was the category adjustment trend brought about by the company's brand renewal. In addition to leather shoes, products such as white shoes, sneakers, and dad shoes, which are close to young people, have also had a wave of presence.

In recent years, the company's brand upgrade and iteration have achieved remarkable results. On the basis of maintaining the advantages of the original leather shoes, it has launched fashion footwear products that are more suited to the style of the new era, which has been recognized by young consumers. Company President Qian Fan explained at the conference that popular products in 2023 include “Double Love Mary Jane” platform loafers, trendy retro sneakers, “Feiyun bread shoes”, and Forgan shoes from the IP series of the China Shoe Culture Museum.

This year, the company plans to concentrate resources to expand the “light outdoor” category and launch light outdoor related brands at the right time. Qian Cheng, director of the company, said at the performance meeting that according to the company's earlier concept of “light outdoor is a way of life”, “light outdoor” products will be laid out in the direction of “lifestyle.”

In addition to brand upgrades and iterations, the company also achieved good results in reducing costs and increasing efficiency in 2023. Among them, in 2023, Red Dragonfly's R&D expenses decreased by 15.49% year on year. The company explained that it “introduced an AI platform for shoe design to improve design efficiency and reduce labor costs and proofing costs.” In terms of digitalization, the company also specifically mentioned the “Good Cargo” digital platform, saying that under the premise of an increase in total order volume, “Good Cargo” helped Red Dragonfly reduce the order width by 50% and increase the order concentration rate.

Furthermore, based on supply chain optimization, Red Dragonfly's inventory last year was 494 million yuan, down 10.68% year on year. The number of inventory turnover days was 121 days, a decrease of 21 days year on year.

In terms of sales channels, Red Dragonfly mentioned at the performance conference that the company's share of online revenue in 2023 was 30.72%, maintaining the leading online rate of listed companies in the domestic footwear industry. In 2023, Red Dragonfly's online sales revenue was 683 million yuan, an increase of 11.5% over the previous year. The company deployed major e-commerce, content, and social platforms, and set up an official live broadcast room on Douyin to broadcast the brand live.

In terms of offline stores, Qian Fan explained, “The company opened the country's first Red Dragonfly flagship store on Wuma Street Pedestrian Street in the core business district of Wenzhou on August 18, 2023. Second, it increased the expansion of terminal stores, especially shopping center stores, and added 65 new self-operated stores, further increasing the share of sales revenue of the DTC retail operation model.”

Red Dragonfly's professional shoe group purchase business in 2020 achieved sales revenue of over 200 million yuan in 2023. The company said it will continue to make efforts in the professional shoe group purchase business in the future.