are delivering, solid view on H2 July 26, 2018 Heikki Takala, - - PowerPoint PPT Presentation

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are delivering, solid view on H2 July 26, 2018 Heikki Takala, - - PowerPoint PPT Presentation

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Amer Sports Q2/2018 Normal Q2, strategic priorities are delivering, solid view on H2 July 26, 2018 Heikki Takala, President and CEO Normal Q2 Net sales EUR 483.0 million (495.8), +2%* Top line mostly in-season orders

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“Normal” Q2, strategic priorities are delivering, solid view on H2

July 26, 2018 – Heikki Takala, President and CEO Amer Sports Q2/2018

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SLIDE 2

“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

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SLIDE 3

Strategic priorities are delivering

  • Direct to Consumer +15% to EUR 50 million in sales:
  • wn 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 Presentation 3

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SLIDE 4

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

26 July 2018 Amer Sports Half Year Financial Report Presentation 4

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SLIDE 5

Peak Performance accelerates our transformation

  • Faster growth and profitability in Apparel, better asset efficiency

26 July 2018 Amer Sports Half Year Financial Report Presentation 5

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SLIDE 6

Balance sheet

26 July 2018 Amer Sports Half Year Financial Report Presentation 6

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

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SLIDE 7

Development of Gross Margin and USD hedges

26 July 2018 Amer Sports Half Year Financial Report Presentation 7

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

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SLIDE 8

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 LTM FY-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 Presentation 26 July 2018

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SLIDE 9

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)

26 July 2018 Amer Sports Half Year Financial Report Presentation

* In local currencies

100 200 300 400 500 600

Net sales

MEUR

Q2/14 Q2/15 174.8 Q2/16 209.7 Q2/17 231.0 Q2/18 241.6 244.1

  • 40
  • 20

20 40 60 80 100 120

EBIT excluding items affecting comparability

MEUR

  • 22.0

Q2/18 Q2/14

  • 18.7

Q2/15 Q2/16

  • 16.0

Q2/17

  • 29.4
  • 30.7

9

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SLIDE 10

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)

26 July 2018 Amer Sports Half Year Financial Report Presentation

* In local currencies

20 40 60 80 100 120 140 160 180 200

Net sales

MEUR

Q2/18 169.4 Q2/14 Q2/15 165.5 136.2 Q2/16 Q2/17 169.8 159.0

2 4 6 8 10 12 14 16 18 20

EBIT excluding items affecting comparability

MEUR

Q2/18 Q2/14 Q2/15 11.0 Q2/16 11.3 6.3 7.7 Q2/17 9.3

10

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SLIDE 11

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

26 July 2018 Amer Sports Half Year Financial Report Presentation

* In local currencies

20 40 60 80 100 120 140

Net sales

MEUR

Q2/18 65.1 Q2/14 Q2/15 Q2/16 82.0 80.9 Q2/17 84.4 79.9 Q2/18 Q2/14 Q2/15 Q2/16 Q2/17

2 4 6 8 10 12 14 16

EBIT excluding items affecting comparability

4.1 0.0 5.1 4.5 2.5

11

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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.

26 July 2018 Amer Sports Half Year Financial Report Presentation 12

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SLIDE 13
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Appendix

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SLIDE 15

Net sales and EBIT breakdown

26 July 2018 Amer Sports Half Year Financial Report Presentation

* 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

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SLIDE 16

Net sales by Business Unit in Q2

26 July 2018 Amer Sports Half Year Financial Report Presentation

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

296.9 Team Sports 80.8 87.4

  • 8

362.1 Fitness 79.9 84.4

  • 5

375.6

* In local currencies

16

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SLIDE 17

26 July 2018 Amer Sports Half Year Financial Report Presentation

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 Fitness 16.3

  • 6

47.5

  • 1

16.1 12 79.9 Total 171.5 229.0 1 82.5 10 483.0 2

* Change in local currencies

17

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Foreign currency translation difference

26 July 2018 Amer Sports Half Year Financial Report Presentation

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

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SLIDE 19

Balance sheet

26 July 2018 Amer Sports Half Year Financial Report Presentation

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

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Loan portfolio and maturity structure

26 July 2018 Amer Sports Half Year Financial Report Presentation 20

  • 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%)

50 100 150 200 250 300 350 400

2018 2019 2020 2021 2022 2023=>

Bridge loan (Peak) Bonds Bank loans Commercial Papers Other

EURm

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SLIDE 21

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

26 July 2018 Amer Sports Half Year Financial Report Presentation 21

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

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SLIDE 22

IFRS 15 Adjustments

26 July 2018 Amer Sports Half Year Financial Report Presentation 22

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SLIDE 23

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

26 July 2018 Amer Sports Half Year Financial Report Presentation 23

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SLIDE 24

Disclaimer Statements 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 expressed in 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 or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this presentation.

www.amersports.com

26 July 2018 Amer Sports Half Year Financial Report Presentation 24

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