Accumulated Retail Performance Recorded Growth for the First Half Year With Strong E-commerce Momentum

HONG KONG, CHINA - Media OutReach - 21 October 2019 - The leadinginternational sportswear brand enterprise in the PRC, China Dongxiang (Group) Co., Ltd. ("China Dongxiang" or"the Company", together with its subsidiaries, "the Group",HKEx stock code: 3818) announces the operational data for the second quarter ofthe three months ended 30 September 2019 (''FY2019/20 Q2'') and the six monthsended 30 September 2019 (''FY2019/20 1H'').

For theFY2019/20 Q2, the retail performance of Kappa stores (excluding Kappa kids'apparel business and Japan business) for the overall platform registered amid-teens growth on a year-on-year basis, of which the off-line businessrecorded a high single digit growth and the e-commerce business recorded amid-to-high-fifties growth. For the FY2019/20 1H, the accumulated retailperformance for the overall platform registered a low-teens growth on ayear-on-year basis, of which the off-line business recorded a mid-to-highsingle digit growth and the e-commerce business recorded a low-forties growth.

As for the same-store-sales ("SSS"), for the FY2019/20 Q2, in respect ofKappa stores (excluding Kappa kids' apparel business and Japan business) whichhave been in operation since the beginning of the same quarter last year, theSSS for the overall platform registered a mid-to-high single digit increase ona year-on-year basis, of which the off-line business recorded a low single digitdecrease while the e-commerce business registered a mid-to-high-fifties growth.For the FY2019/20 1H, the SSS for the overall platform registered a mid-to-lowsingle digit increase on a year-on-year basis, of which the off-line businessrecorded a mid-to-low single digit decrease while the e-commerce businessregistered a low-forties growth.

As of FY2019/20 Q2, the number of retail stores of the Group under Kappabrand was 1,176 (excluding Kappa kids' apparel business and Japan business), representinga net decrease of 33 as compared with that as at 31 March 2019 (''the end ofFY2018/19''). The Group will further reduce the number of stores withunsatisfactory performance.

Mr. Zhang Zhiyong, CEO, President and Executive Director of China Dongxiang, said, "The Group's overall business of Kappa brand continued torecover. Attributed by the Group's reforms and effective channel strategy,growth momentum of the e-commerce business, outlet channel and certain majorretail regions has been established. In the future, in terms of channel, we will continue our reform ondirect-franchise, with outlets and shopping malls being the priority.Meanwhile, localisation of nationwide sales team will be continued. As forproducts, we will improve the management of product life cycle in order tolower the level of inventory. Furthermore, we will introduce more talents forproduct research and development to further promote the product reforms."

About China Dongxiang (Group) Co., Ltd. (Stock code: 3818)

China Dongxiang (Group) Co., Ltd. is aleading international sportswear brand enterprise in China which has beenlisted on the Main Board of the Hong Kong Stock Exchange since 10 October 2007.The Group is primarily engaged in the design, development, marketing andwholesale of branded sportswear in China. Currently, China Dongxiang owns allrights to the internationally renowned Kappa brand in China, Macau and Japan.On 1 May 2008, China Dongxiang completed the acquisition of PHENIX, a Japanesesportswear enterprise. PHENIX is the most popular ski brand in Japan with thelargest market share, as well as a well-known brand in the internationalmarket.