amer sports q2/2018 “normal” q2, strategic priorities are ...€¦ · “normal” q2,...

“Normal” Q2, strategic priorities are delivering, solid view on H2July 26, 2018 – Heikki Takala, President and CEO

Amer Sports Q2/2018

“Normal” Q2

• Net sales EUR 483.0 million (495.8), +2%*

– Top line mostly in-season orders

• EBIT excl. IAC EUR -25.5 million (-22.8)

– Reflecting spending into H2 and beyond

• EPS excl. IAC EUR -0.22 (-0.20)

• Working Capital reflects inventory build-up for H2

26 July 2018 Amer Sports Half Year Financial Report Presentation

* In local currencies

The comparative figures for 2017 have been restated in accordance with IFRS 15 Revenue from contracts with customers and IFRS 9 Financial instruments

2

Strategic priorities are delivering

• Direct to Consumer +15% to EUR 50 million in sales:

own retail +11% (same store growth +4%), e-commerce +22%

• Modern sales channels ~30% of sales

• Arc’teryx double-digit growth and strong order book

• China +21%

• US starting to rebound

• Footwear distribution consolidation continues,

expected to re-ignite growth in 2019

26 July 2018 Amer Sports Half Year Financial Report Presentation3

Solid view on H2

• Double digit growth in pre-order/order book:

– Winter Sports Equipment

– Arc’teryx

– Sports Instruments

• Precor won its largest ever two-year customer contract

• Peak Performance contributes to profit and growth as of Q3


Peak Performance accelerates our transformation

• Faster growth and profitability in Apparel, better asset efficiency


Balance sheet


EUR million

June 30,

2018

June 30,

2017

Dec. 31,

2017

Net debt 820.2 584.4 460.7

Shareholders’ equity 841.9 837.8 885.4

Capital employed 1,662.2 1,422.3 1,346.0

Working capital 759.5 731.6 755.4

Capital turnover 1.83X 1.78X 1.87X

ROCE*, % 15.0 13.4 14.8

Net debt/EBITDA* LTM 2.88 2.18 1.62

Net debt/equity 0.97 0.69 0.52

* Excluding IAC

Development of Gross Margin and USD hedges


1.000

1.050

1.100

1.150

1.200

1.250

1.300

1.350

1.400

Jan-15 Jan-16 Jan-17 Jan-18 Jan-19

45.2%

46.3%

44.9% 45.3%Q2 LTM

Gross Margin

USD/EUR Hedges

USD/EUR Spot

EUR/USD

H1 OPEX growth at last year level

8

16

4

20

6

6

4

3

9

-8

5

-6

2

H1-17 H1-18 6/18 LTMFY-17

Topline driven

Investment driven

Maintenance driven

14

13

18

17

Topline driven

• Sales/customer service personnel

• Sales commissions

• Retails stores (> 1year operative)

• Outbound freight

• Warehousing costs

• Marketing: sell-in, sell-through

• Warranties, bad debts

Investment driven

• R&D

• Sales personnel: distribution expansion

• New retail stores (< 1year operative)

• Digital platform

• Consumer marketing (acceleration)

Maintenance driven

• G&A

Amer Sports Half Year Financial Report Presentation26 July 2018

Outdoor Q2/2018 (Q2/2017)

Net sales EUR 244.1 million, +4%*

• Apparel +10%, driven by Arc’teryx

• Footwear -2%, consolidation of global distribution footprint continued

• Winter Sports pre-orders +10%

• Sports Instruments +23%

• Cycling -10%: declined OEM orders, low demand in wholesale channel

EBIT excl. IAC EUR -30.7 million (-29.4)



0

100

200

300

400

500

600

Net salesMEUR

Q2/14 Q2/15

174.8

Q2/16

209.7

Q2/17

231.0

Q2/18

241.6 244.1

-40

-20

0

20

40

60

80

100

120

EBIT excluding items affecting comparabilityMEUR

-22.0

Q2/18Q2/14

-18.7

Q2/15 Q2/16

-16.0

Q2/17

-29.4 -30.7

9

Ball Sports Q2/2018 (Q2/2017)

Net sales EUR 159.0 million,

at previous year’s level*

EBIT excl. IAC EUR 11.0 million (9.3)

Solid profitability improvement:

EBIT margin excl. IAC 6.9% (5.5)



0

20

40

60

80

100

120

140

160

180

200

Net salesMEUR

Q2/18

169.4

Q2/14 Q2/15

165.5

136.2

Q2/16 Q2/17

169.8 159.0

0

2

4

6

8

10

12

14

16

18

20

EBIT excluding items affecting comparabilityMEUR

Q2/18Q2/14 Q2/15

11.0

Q2/16

11.3

6.37.7

Q2/17

9.3

10

Fitness Q2/2018 (Q2/2017)

Net sales EUR 79.9 million,

at previous year’s level*

• Strong growth in China and Japan

• Significant new product and

customer expansions

EBIT excl. IAC EUR 0.0 million (2.5)

• Sales and EBIT biased to the

second half of the year

Precor just closed the largest customer

contract ever with Planet Fitness, worth

at least USD 30 million over 2 years,

starting in Q4



0

20

40

60

80

100

120

140

Net salesMEUR

Q2/18

65.1

Q2/14 Q2/15 Q2/16

82.0 80.9

Q2/17

84.4 79.9

Q2/18Q2/14 Q2/15 Q2/16 Q2/170

2

4

6

8

10

12

14

16

EBIT excluding items affecting comparability

4.1

0.0

5.14.5

2.5

11

Outlook unchanged – guided by our long term targets and strategies

• In 2018, Amer Sports’ net sales in local currencies as well as EBIT excl. IAC

are expected to increase from 2017. Due to ongoing wholesale market

uncertainties, the quarterly growth and improvement are expected to be

uneven.

• The company will prioritize sustainable, profitable growth, focusing on its

five strategic priorities (Apparel and Footwear, Direct to Consumer, China,

US, and Connected Devices and Services) whilst continuing its consumer-

led transformation.


Appendix

Net sales and EBIT breakdown


* Excl. IAC

NET SALES

(MEUR)

Q2/

2018

Q1/

2018 2017

Q4/

2017

Q3/

2017

Q2/

2017

Q1/

2017 2016

Q4/

2016

Q3/

2016

Q2/

2016

Q1/

2016

Outdoor 244.1 381.2 1,674.7 537.9 500.5 241.6 394.7 1,601.8 490.7 505.7 231.0 374.4

Ball Sports 159.0 164.2 659.0 163.0 141.2 169.8 185.0 671.1 171.9 147.0 165.5 186.7

Fitness 79.9 78.4 375.6 118.9 87.8 84.4 84.5 349.2 109.8 84.1 80.9 74.4

Total 483.0 623.8 2,709.3 819.8 729.5 495.8 664.2 2,622.1 772.4 736.8 477.4 635.5

EBIT

(MEUR)

Q2/

2018*

Q1/

2018 2017*

Q4/

2017*

Q3/

2017*

Q2/

2017*

Q1/

2017* 2016*

Q4/

2016*

Q3/

2016*

Q2/

2016

Q1/

2016*

Outdoor -30.7 33.7 178.5 81.0 100.1 -29.4 26.8 196.9 69.7 105.5 -16.0 37.7

Ball Sports 11.0 14.9 45.2 13.8 6.3 9.3 15.8 44.8 12.8 5.3 7.7 19.0

Fitness 0.0 0.1 20.1 12.4 4.5 2.5 0.7 17.0 6.8 5.4 4.5 0.3

Headquarters -5.8 -8.3 -29.3 -9.5 -6.8 -5.2 -7.8 -37.0 -8.0 -9.7 -8.3 -11.0

Total -25.5 40.4 167.8 97.7 104.1 -22.8 35.5 221.7 81.3 106.5 -12.1 46.0

15

Net sales by Business Unit in Q2


MEUR Q2/2018 Q2/2017

Ch

%

Ch

%* 2017

Footwear 96.4 101.3 -5 -2 500.8

Apparel 63.5 60.4 5 10 482.3

Winter Sports Equipment 15.6 14.4 8 13 415.2

Cycling 27.9 31.5 -11 -10 134.7

Sports Instruments 40.7 34.0 20 23 141.7

Individual Ball Sports 78.2 82.4 -5 0 296.9

Team Sports 80.8 87.4 -8 0 362.1

Fitness 79.9 84.4 -5 0 375.6


16


16%35%

49%

16%35%

49%

16%35%

49%

Outdoor

244.1

20% 51%

29%

Ball Sports

159.0

11% 20%

69%

Fitness

79.9

20% 20%

60%

Total

483.0

17% 36%

47%

EMEA Americas APAC

Sales development by region

EMEA Americas APAC Total

MEUR Ch, %* MEUR Ch, %* MEUR Ch, %* MEUR Ch, %*

Outdoor 124.2 1 71.5 4 48.4 15 244.1 4

Ball Sports 31.0 -2 110.0 1 18.0 -3 159.0 0

Fitness 16.3 -6 47.5 -1 16.1 12 79.9 0

Total 171.5 0 229.0 1 82.5 10 483.0 2

* Change in local currencies

17

Foreign currency translation difference


Q2/2018 Q2/2017 Change

Reported Reported Local FX Reported, % Local FX, %

Footwear 96.4 101.3 98.0 -5% -2%

Apparel 63.5 60.4 58.0 5% 10%

Winter Sports Equipment 15.6 14.4 13.8 8% 13%

Cycling 27.9 31.5 30.7 -11% -10%

Sports Instruments 40.7 34.0 33.1 20% 23%

Outdoor 244.1 241.6 233.6 1% 4%

Individual Ball Sports 78.2 82.4 78.5 -5% 0%

Team Sports 80.8 87.4 81.2 -8% 0%

Ball Sports 159.0 169.8 159.7 -6% 0%

Fitness 79.9 84.4 79.9 -5% 0%

Total 483.0 495.8 473.0 -3% 2%

18

Balance sheet


MEUR June 30, 2018 June 30, 2017 December 31, 2017

Goodwill and other intangible non-current assets 932.0 679.9 649.2

Tangible non-current assets and other non-

current assets 345.0 329.0 340.5

Inventories and work in progress 637.5 569.5 481.3

Receivables 594.0 547.9 772.2

Cash and cash equivalents 152.9 246.4 358.4

Shareholders’ equity 841.9 837.8 885.4

Interest bearing liabilities 973.1 830.8 819.1

- Long-term 592.7 828.9 632.8

- Current 380.4 1.9 186.3

Other liabilities 846.4 704.1 897.6

Total 2,661.4 2,372.7 2,602.1

19

Loan portfolio and maturity structure


• Cash EUR 152.9 million and unused

committed facilities EUR 200 million

(June 30, 2018)

• Commercial paper program in size of

EUR 500 million; out of which EUR 30.0

million utilized

• Scheduled H2/2018 repayments of long-

term loans EUR 197.5 million

• Average interest rate of loan portfolio

2.1% (June 30, 2017 2.5%) 0

50

100

150

200

250

300

350

400

2018 2019 2020 2021 2022 2023=>

Bridge loan (Peak) Bonds Bank loans Commercial Papers Other

EURm

Next 12 months net cash flows and related hedges, main FX pairs


Main FX pairs Hedge% Next 12mth

flow (EURm)

ECB Fixing

rate

(@29.06.18)

Hedge

FX’18

Hedge

FX’19

USD purchases against EUR 100% -408 1.17 1.14 1.22

USD sales against EUR 100% +68 1.17 1.19 1.24

GBP sales against EUR 100% +87 0.89 0.89 0.90

CHF sales against EUR 100% +51 1.16 1.12 1.16

USD (net)purchases

against CAD 100% -160 1.32 1.28 1.26

IFRS 15 Adjustments


Contact information

• Heikki Takala, President and CEO

Tel. +358 20 712 2510

• Jussi Siitonen, CFO

Tel. +358 20 7122511

• Samppa Seppälä, Director, Corporate Communications and IR

Tel. +358 50 5680533

www.amersports.com


DisclaimerStatements in this presentation, which are not historical facts, such as expectations, anticipations, beliefs and estimates,are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995.Such statements involve risks and uncertainties which may cause actual results to materially differ from those expressedin such forward-looking statements.Amer Sports assumes no responsibility to update any of the forward-looking statements contained herein.No representation or warranty, express or implied, is made or given by or on behalf of Amer Sports or its employees orany other person as to the accuracy, completeness or fairness of the information or opinions contained in this presentation.

www.amersports.com


amer sports q2/2018 “normal” q2, strategic priorities are ...€¦ · “normal” q2,...

Documents