AMER SPORTS Q3/2012 October 25, 2012 // Heikki Takala, President and CEO Broad-based growth, offset by Winter Sports Equipment softness • Net sales EUR 601.9 million (559.2), +2% in local currencies ( ), - Apparel +27%, Sports Instruments +24%, Fitness +10%, Tennis +8%, Cycling +7%, Winter Sports Equipment -15% - Major retailer de-stocking in Europe, Footwear sales unchanged - Geographically, EMEA -2%, Americas +4% and APAC +12% - Own retail and e-commerce progressing fast • Gross margin 45.3% (45.3%) • EBIT EUR 80.8 million (74.4) • Group-wide restructuring program to be started in order to drive further scale and synergies and continue reallocating resources to sustain growth 2 Amer Sports Results Presentation 1
EBIT development Q3/2012 YoY, EUR million 7.5 1.5 1.5 1.1 82 82 8.3 80.8 80.8 80 80 4.9 6.7 78 78 76 76 74.4 74.4 74 74 72 72 70 70 68 68 66 66 64 64 62 62 60 60 Q3/11 Growth OPEX Other Q3/12 Q3/11 W&O Ball Fitness HQ Q3/12 & FX Sports 3 Amer Sports Results Presentation Cash flow improved, focus on working capital management 7–9/12 7–9/11 EUR million Ch % Ch %* 2011 Net sales N t l 601 9 601.9 559 2 559.2 8 8 2 1 880 8 2 1,880.8 Gross profit 272.9 253.4 8 2 817.4 Gross profit, % of net sales 45.3 45.3 43.5 EBIT 80.8 74.4 9 2 135.5 EBIT % 13.4 13.3 7.2 Net cash flow after investing activities -78.1 -90.4 -21.4 * Change in local currencies Change in local currencies 4 Amer Sports Results Presentation 2
Balance sheet EUR million Sep 30, 2012 Sep 30, 2011 Dec 31, 2011 Net debt 539.3 429.1 391.6 Shareholders equity Shareholders’ equity 765 6 765.6 786 1 786.1 829 4 829.4 Capital employed* 1,115.2 1,004.3 1,027.3 Working capital 561.2 505.0 469.3 Gearing, % 70 55 47 Equity ratio, % 39.7 44.0 45.6 * 12 month rolling average Increase in gearing is due to the redemption of the hybrid bond in I i i i d t th d ti f th h b id b d i March (impact 12 percentage points) Inventories are healthy • 2/3 of inventories are softgoods and Winter Sports Equipment • Of this, the vast majority is current or next season products 5 Amer Sports Results Presentation Mid-term refinancing needs covered 175,0m • Cash reserves EUR 121.5 million 150,0m • Unused credit facilities EUR 125,0m 240.0 million. 100,0m • Scheduled repayments of 75,0m long term debt EUR 45.2 million in calendar years of 50,0m 2012 and 2013. 25,0m ,0m 2012 2013 2014 2015 2016=> Pension Loan Term Loan Bonds Commercial Papers Other The average interest rate of loan portfolio: 3.4% (December 31, 2011: 3.6%) 6 Amer Sports Results Presentation 3
Winter and Outdoor in Q3/2012 (Q3/2011) EBIT excluding Net sales MEUR MEUR non-recurring items 100 450 411.0 86.8 395.7 79.3 400 80 58.2 350 300.3 262.4 60 44.1 300 40 250 250 200 20 150 0 100 -20 50 0 -40 Q3/09 Q3/10 Q3/11 Q3/12 Q3/09 Q3/10 Q3/11 Q3/12 Net sales -1% • Winter Sports Equipment -15%: pre-orders down by 13% • Footwear at last year’s level: customer de-stocking in Europe • Apparel +27%: growth in both Salomon and Arc’teryx • C Cycling +7% li +7% • Sports Instruments +24%: early signs of turnaround continue EBIT EUR 86.8 million (79.3) • Gross margins up EUR 6 million • Operating expenses up EUR 8 million, offset by foreign exchange gains 7 Amer Sports Results Presentation Ball Sports Q3/2012 (Q3/2011) EBIT exluding Net sales MEUR MEUR non-recurring items 180 25 160 20 140 121.9 114.0 106.7 106.7 120 120 103 4 103.4 15 100 10 80 3.5 60 2.4 5 -1.1 -2.6 40 0 20 -5 0 Q3/09 Q3/10 Q3/12 Q3/11 Q3/12 Q3/09 Q3/10 Q3/11 Net sales +4% • Individual Sports +8% • • Team Sports -1%: US trade de-stocking bat inventories Team Sports -1%: US trade de-stocking bat inventories • APAC +20%, Americas +3%, EMEA -3% EBIT EUR -2.6 million (-1.1) • Decline in baseball margins 8 Amer Sports Results Presentation 4
Fitness Q3/2012 (Q3/2011) EBIT excluding Net sales MEUR non-recurring items MEUR 6 80 4.2 69.0 70 4 2.8 2.8 56.8 60 52.6 52.6 2 2 44 8 44.8 -1.4 50 0 40 30 -2 20 -4 10 0 -6 Q3/09 Q3/10 Q3/11 Q3/12 Q3/09 Q3/10 Q3/11 Q3/12 Net sales +10% • Commercial gains, impact of strong innovation EBIT EUR 4.2 million (2.8) • Driven by higher sales volumes 9 Amer Sports Results Presentation OUTLOOK 5
Outlook for 2012 unchanged • In 2012, Amer Sports’ net sales in local currencies are expected to increase from 2011 in line with the company’s annual 5% growth target. • Amer Sports 2012 EBIT excluding non-recurring items is expected to be approximately at the level of 2011. • The outlook is based on an unchanged view on Winter Sports Equipment, Apparel and Footwear, and ongoing improvement in Sports Instruments and Fitness. 11 Amer Sports Results Presentation WE CONTINUE MOVING 6
Investing into future growth • Broad-based improvement • Expansion of softgoods p g - Apparel +29% in Q1-Q3. Future brand/category expansions in the pipeline • Continuous improvement in Go to Market, including emerging markets • Own retail - 18 new stores in the past 12 months, already 23 e-commerce stores • Operational excellence - Winter Sports Equipment: Focus project delivering target gross margin benefits 13 Amer Sports Results Presentation A Group-wide restructuring program to be started • Reminder from the CMD: cost and complexity remain a key p y y challenge • Growth continues guided by our long-term financial targets • We now accelerate integration further to achieve scale and synergies and to sustain the growth • After the program (end 2014 onwards), estimated annual savings EUR 20 million g 14 Amer Sports Results Presentation 7
We stay the course Profitability, growth acceleration Build critical capabilities, allocate resources and ~2013- reignite growth reignite growth • Continued growth in Clarify future direction & ~2011...2012 categories and countries deliver the year • Big brands, big countries, • Build capabilities: ~2010 • Softgoods big categories • Category based development • Go to market • Clarify priorities, set direction • Drive organic growth: softgoods, Russia, China, BtoC, • Continue to drive profit p etc. recovery, deliver the year • Operational excellence, WSE • Continue the work on efficiency & profitability operational efficiency & margins improvement 15 Amer Sports Results Presentation 8
APPENDIX Net sales and EBIT Q3/ Q3/ Ch Ch Ch Ch EUR million 2012 2011 % %* 2011 2010 % %* NET SALES, TOTAL 1,880.8 1,740.4 8 9 Winter and Outdoor 411.0 395.7 4 -1 1,137.6 1,015.0 12 12 Winter Sports Equipment 163.7 185.4 -12 -15 448.4 438.4 2 2 Footwear 92.9 90.7 2 0 287.7 219.6 31 31 Apparel 95.0 69.5 37 27 191.6 156.6 22 22 Cycling 31.3 28.7 9 7 120.5 106.4 13 14 Sports Instruments 28.1 21.4 31 24 89.4 94.0 -5 -4 Ball Sports 121.9 106.7 14 4 511.0 520.6 -2 0 local currencies 72.1 61.6 17 8 283.0 308.5 -8 -7 Individual Ball Sports 49.8 45.1 10 -1 228.0 212.1 7 11 Team Sports rring items 69.0 56.8 21 10 232.2 204.8 13 17 Fitness 80.8 80 8 74 4 74.4 9 9 135 5 135.5 107.9** 107 9** 26 26 EBIT, TOTAL EBIT TOTAL * Comparable sales in ** Excluding non-recur 86.8 79.3 9 118.5 96.9 22 Winter and Outdoor -2.6 -1.1 25.0 32.2 -22 Ball Sports 4.2 2.8 50 10.3 2.7 Fitness -7.6 -6.6 -18.3 -23.9 Headquarters -78.1 -90.4 -21.4 50.1 Free cash flow 18 Amer Sports Results Presentation 9
Net sales and EBIT breakdown (MEUR) NET Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ SALES 2012 2012 2012 2011 2011 2011 2011 2011 2010 2010 2010 2010 2010 Winter and Outdoor 411.0 150.9 256.5 1,137.6 375.0 395.7 133.4 233.5 1,015.0 416.5 300.3 116.5 181.7 Ball Sports 121.9 146.5 173.6 511.0 109.0 106.7 136.3 159.0 520.6 107.3 114.0 153.9 145.4 Fitness 69.0 56.4 59.7 232.2 72.9 56.8 45.9 56.6 204.8 59.6 52.6 47.1 45.5 Total 601.9 353.8 489.8 1,880.8 556.9 559.2 315.6 449.1 1,740.4 583.4 466.9 317.5 372.6 Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ EBIT 2012 2012 2012 2011 2011 2011 2011 2011 2010 2010 2010 2010 2010 Winter and Outdoor 86.8 -25.4 10.7 118.5 45.0 79.3 -15.1 9.3 96.9 51.2 58.2 -24.2 1.7 Ball Sports -2.6 9.7 19.9 25.0 -0.7 -1.1 9.1 17.7 32.2 -5.4 3.5 17.0 14.4 Fitness 4.2 1.0 3.9 10.3 4.5 2.8 -0.3 3.3 2.7 2.0 2.8 -3.7 -0.7 Headquarters -7.6 -5.1 -5.5 -18.3 -2.5 -6.6 -4.6 -4.6 -23.9 0.6 -8.7 -6.0 -5.9 Total 80.8 -19.8 29.0 135.5 46.3 74.4 -10.9 25.7 107.9* 48.4 55.8 -16.9 9.5 * Excluding non-recurring items 19 Amer Sports Results Presentation Net sales by region (MEUR) Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ MEUR 2012 2012 2012 2011 2011 2011 2011 2011 2010 2010 2010 2010 2010 EMEA 297.6 133.1 226.7 917.6 273.8 300.0 129.7 214.1 845.7 325.8 226.9 120.8 172.2 Americas 236.2 167.4 205.7 742.1 205.4 203.8 146.5 186.4 687.9 184.1 192.3 153.2 158.3 Asia Pacific 68.1 53.3 57.4 221.1 77.7 55.4 39.4 48.6 206.8 73.5 47.7 43.5 42.1 Total 601.9 353.8 489.8 1,880.8 556.9 559.2 315.6 449.1 1,740.4 583.4 466.9 317.5 372.6 20 Amer Sports Results Presentation 10
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