investments delivering July 28, 2016 Heikki Takala, President and - - PowerPoint PPT Presentation

▶
investments delivering
SMART_READER_LITE
LIVE PREVIEW

investments delivering July 28, 2016 Heikki Takala, President and - - PowerPoint PPT Presentation

Mar 27, 2023 119 likes •416 views

Amer Sports Q2/2016 Acceleration and transformation continue, investments delivering July 28, 2016 Heikki Takala, President and CEO Growth and improvement despite headwinds Net sales EUR 477.4 million (461.1), +6%* Growth driven by

slide-1
SLIDE 1

Amer Sports Q2/2016

Acceleration and transformation continue, investments delivering

July 28, 2016 – Heikki Takala, President and CEO

slide-2
SLIDE 2

Growth and improvement despite headwinds

  • Net sales EUR 477.4 million (461.1), +6%*

– Growth driven by Footwear (+15%), Apparel (+24%), and Cycling (+20%) – EMEA +7%, Americas +6%, APAC +7% (China +34%) – B2C +31%, e-commerce +49%

  • Gross margin 44.7% (44.1%)
  • EBIT EUR -12.1 million (-9.0 excl. IAC), acceleration investments

continued

  • Net sales and profitability adversely impacted by the US customer

bankruptcies

  • Free cash flow EUR -54.3 million (11.5) due to seasonal fluctuation
  • Good momentum in H1

28 July 2016 Amer Sports Interim Report Presentation 2

*In local currencies

slide-3
SLIDE 3

Significant OPEX investments in H1 to support acceleration

  • Digital acceleration, building group-wide consumer database

platform

  • Own retail, expecially Arc’teryx:

– Accelerated store openings: new stores in the US (New York and Chicago), China, Japan, and Austria – More stores opening soon in China, US (New York and Chicago), Canada (Toronto), and Italy

  • Continuous e-commerce expansion, Canada and Japan going live
  • Significant distribution center expansion both in the US and

Europe

  • Moving Arc’teryx into a larger production facility in Canada

28 July 2016 Amer Sports Interim Report Presentation 3

slide-4
SLIDE 4

New Arc’teryx stores in Japan, China and the US

28 July 2016 Amer Sports Interim Report Presentation 4

New York Soho Kobe, Japan Yokohama, Japan Shanghai, China

slide-5
SLIDE 5

Q2 free cash flow negative, however not different from historical pattern

  • Quarterly shifts in repatriation of receivables (40 MEUR) and Asian

vendor payments (20 MEUR)

  • Inventory building for H2, 100% of the inventory is current

28 July 2016 Amer Sports Interim Report Presentation 5

  • 54.4

32.8 172.5

  • 92.2

11.5 43.0 132.8

  • 84.8
  • 38.7

44.2 143.9

  • 119.3
  • 50.0

67.9

  • 150
  • 100
  • 50

50 100 150 200

Q1-16 Q4-15 Q3-15 Q2-15 Q1-15 Q4-14 Q3-14 Q2-16 Q2-14 Q1-14 Q4-13 Q3-13 Q2-13 Q1-13

slide-6
SLIDE 6

Balance sheet in a nutshell

28 July 2016 Amer Sports Interim Report Presentation 6

EUR million June 30, 2016 June 30, 2015

  • Dec. 31, 2015

Net debt 599.9 546.3 460.3 Shareholders’ equity 858.2 804.4 949.6 Capital employed 1,458.1 1,350.7 1,409.9 Working capital 456.6 421.3 462.5 Capital turnover, LTM 1.83X 1.85X 1.90X ROCE, LTM % 15.6 14.7 15.9 Net debt/equity 0.70 0.68 0.48 Equity ratio % 35.8 37.7 37.2

LTM = Last Twelve Months

slide-7
SLIDE 7

28 July 2016 Amer Sports Interim Report Presentation 7

  • 40
  • 20

20 40 60 80 100

EBIT excluding items affecting comparability

100 200 300 400 500 600

Net sales

Outdoor Q2/2016 (Q2/2015)

28 July 2016 7

MEUR MEUR

  • 25.4

Q2/12 Q2/12 Q2/13 150.9 Q2/13

  • 27.1

Q2/14 168.7 Q2/14

Net sales EUR 231.0 million, +13%*

  • Footwear +15%, Apparel +24%
  • Cycling +20%, supported by ENVE
  • Sports Instruments -6%, prepared for a big launch in Q3
  • Winter Sports Equipment pre-orders -3%, a satisfactory result following several mild

winters

  • Agile operating model protects gross margin and cash flow, strong innovation

pipeline secures consumer momentum

EBIT EUR -16.0 million (-18.7 excl. IAC)

Q2/15 174.8 Q2/15

  • 22.0

Q2/16 209.7 Q2/16

  • 18.7

231.0

  • 16.0

*In local currencies

slide-8
SLIDE 8

Acquisition of ENVE

  • Carbon acceleration and global distribution expansion underway

28 July 2016 Amer Sports Interim Report Presentation 8

slide-9
SLIDE 9
  • 5

5 10 15 20 25

EBIT excluding items affecting comparability

Ball Sports Q2/2016 (Q2/2015)

Net sales EUR 165.5 million, at previous year’s level*

  • Sales adversely impacted by the US customer bankruptcies and timing

difference in tennis product launches EBIT EUR 7.7 million (11.3 excl. IAC)

  • Order book is solid and indicates another year of Ball Sports improvement

behind new business model

28 July 2016 Amer Sports Interim Report Presentation 9 28 July 2016 9

MEUR

Q2/12 Q2/13 Q2/14 7.7 Q2/15 7.8 9.7 6.3 Q2/16

20 40 60 80 100 120 140 160 180 200

Net sales

MEUR

Q2/12 144.2 Q2/13 Q2/14 136.2 146.5 Q2/15 Q2/16 169.4 11.3

*In local currencies

165.5

slide-10
SLIDE 10

Fitness Q2/2016 (Q2/2015)

Net sales EUR 80.9 million, +1%*

  • New product and service program (Spinning, Queenax, new cardio…) rolling
  • ut, reaching full speed toward the end of the year

EBIT EUR 4.5 million (5.1 excl. IAC )

28 July 2016 Amer Sports Interim Report Presentation 10 28 July 2016 10

20 40 60 80 100 120 140

Net sales

MEUR

Q2/12 Q2/12 56.4 Q2/13 Q2/13 Q2/14 Q2/15 64.3 Q2/14 65.1 Q2/15 Q2/16 82.0 Q2/16

  • 5

5 10 15 20

EBIT excluding items affecting comparability

1.0 4.5 4.3 4.1 5.1 80.9

*In local currencies

slide-11
SLIDE 11

We focus on acceleration with a tremendous pipeline of initiatives

28 July 2016 Amer Sports Interim Report Presentation 11

slide-12
SLIDE 12

OUTLOOK

slide-13
SLIDE 13

Outlook for 2016

28 July 2016 Amer Sports Interim Report Presentation 13

  • In 2016, Amer Sports net sales in local currencies are expected

to increase and EBIT margin excluding items affecting comparability to improve from 2015, despite challenging market conditions.

  • The company will focus on growing the core business and

accelerating in five prioritized areas: Apparel and Footwear, US, China, Business to Consumer, as well as digitally connected devices and services.

slide-14
SLIDE 14

Prioritized, sequenced program continues

slide-15
SLIDE 15

Acceleration and transformation

15

Net sales ≥3.5 BEUR, improving EBIT-%

~2010 – 2013 ~2014 – 2015 ~2016 – 2020 Turnaround

Net sales 1.5 BEUR, EBIT-% 4% Net sales 2+ BEUR, EBIT-% 7% Net sales ~2.5 BEUR, EBIT-% toward 10%

Amer Sports Interim Report Presentation

Sustainable Growth Model and acquisition readiness Acceleration and scaling up, transformation of company profile continues

28 July 2016

slide-16
SLIDE 16
slide-17
SLIDE 17

APPENDIX

slide-18
SLIDE 18

Net sales and EBIT breakdown

28 July 2016 18

* Excl. IAC NET SALES (MEUR) Q2/ 2016 Q1/ 2016 2015 Q4/ 2015 Q3/ 2015 Q2/ 2015 Q1/ 2015 2014 Q4/ 2014 Q3/ 2014 Q2/ 2014 Q1/ 2014 Outdoor 231.0 374.4 1,530.1 501.9 476.6 209.7 341.9 1,371.2 456.7 452.2 174.8 287.5 Ball Sports 165.5 186.7 647.0 165.7 147.8 169.4 164.1 536.7 136.9 112.9 136.2 150.7 Fitness 80.9 74.4 357.3 116.1 89.3 82.0 69.9 320.8 111.7 80.7 65.1 63.3 Total 477.4 635.5 2,534.4 783.7 713.7 461.1 575.9 2,228.7 705.3 645.8 376.1 501.5 EBIT (MEUR) Q2/ 2016 Q1/ 2016* 2015* Q4/ 2015 Q3/ 2015 Q2/ 2015* Q1/ 2015* 2014* Q4/ 2014* Q3/ 2014* Q2/ 2014* Q1/ 2014 Outdoor

  • 16.0

37.7 161.2 65.6 92.9

  • 18.7

21.4 125.6 55.0 83.1

  • 22.0

9.5 Ball Sports 7.7 19.0 46.6 8.2 8.8 11.3 18.3 35.9 12.5 3.9 6.3 13.2 Fitness 4.5 0.3 31.2 15.7 9.1 5.1 1.3 29.7 14.9 7.3 4.1 3.4 Headquarters

  • 8.3
  • 11.0
  • 26.9
  • 5.5
  • 7.3
  • 6.7
  • 7.4
  • 22.9
  • 4.7
  • 6.7
  • 6.0
  • 5.5

Total

  • 12.1

46.0 212.1 84.0 103.5

  • 9.0

33.6 168.3 77.7 87.6

  • 17.6

20.6

Amer Sports Interim Report Presentation

slide-19
SLIDE 19

Business area net sales

28 July 2016 Amer Sports Interim Report Presentation 19

Q2/2016 Q2/2015 Ch % Ch %* 2015 Footwear 97.0 86.4 12 15 461.2 Apparel 48.8 41.3 18 24 387.2 Winter Sports Equipment 16.1 16.6

  • 3
  • 3

400.2 Cycling 38.0 31.7 20 20 138.5 Sports Instruments 31.1 33.7

  • 8
  • 6

143.0 Individual Ball Sports 79.5 88.2

  • 10
  • 7

315.4 Team Sports 86.0 81.2 6 9 331.6 Fitness 80.9 82.0

  • 1

1 357.3 Total 477.4 461.1 4 6 2,534.4

*Change in local currencies

slide-20
SLIDE 20

Net sales by region

28 July 2016 20

MEUR Q2/ 2016 Q1/ 2016 2015 Q4/ 2015 Q3/ 2015 Q2/ 2015 Q1/ 2015 2014 Q4/ 2014 Q3/ 2014 Q2/ 2014 Q1/ 2014 EMEA 174.8 278.9 1,114.7 356.8 319.3 168.0 270.6 1,064.0 336.9 321.9 156.1 249.1 Americas 229.8 267.1 1,070.1 313.2 302.0 224.7 230.2 874.3 270.1 249.0 166.0 189.2 Asia Pacific 72.8 89.5 349.6 113.7 92.4 68.4 75.1 290.4 98.3 74.9 54.0 63.2 Total 477.4 635.5 2,534.4 783.7 713.7 461.1 575.9 2,228.7 705.3 645.8 376.1 501.5

Amer Sports Interim Report Presentation

slide-21
SLIDE 21

Outdoor

Sales development by region in Q2/2016

28 July 2016 Amer Sports Interim Report Presentation 21

Fitness Total

EMEA Americas APAC

Ball Sports

EMEA Americas APAC Total MEUR Ch, %* MEUR Ch, %* MEUR Ch, %* MEUR Ch, %* Outdoor 125.7 8 65.8 21 39.5 18 231.0 13 Ball Sports 31.7 8 116.0 1 17.8

  • 12

165.5 Fitness 17.4

  • 3

48.0 15.5 11 80.9 1 Total 174.8 7 229.8 6 72.8 7 477.4 6

* Change in local currencies

231.0 165.5 80.9 477.4 17% 68% 11% 19% 70% 19% 22% 59% 15% 37% 48% 54% 29%

slide-22
SLIDE 22

Balance sheet

28 July 2016 Amer Sports Interim Report Presentation 22

MEUR June 30, 2016 June 30, 2015 Goodwill and other intangible non-current assets 665.7 592.6 Tangible non-current assets and other non-current assets 344.5 326.5 Inventories and work in progress 585.7 517.8 Receivables 574.2 584.5 Cash and cash equivalents 229.9 109.6 Shareholders’ equity 858.2 804.4 Interest bearing liabilities 829.8 655.9

  • Long-term

777.7 480.8

  • Current

52.1 175.1 Other liabilities 712.0 670.7 Total 2,400.0 2,131.0

slide-23
SLIDE 23

Refinancing needs well covered

28 July 2016 Amer Sports Interim Report Presentation 23

  • Cash EUR 229.9 million and

unused committed facilities EUR 150 million (June 30, 2016)

  • Commercial paper program in

size of EUR 500 million; out of which EUR 49.9 million utilized

  • No scheduled repayments of

long-term loans in 2016 or in 2017.

  • Average interest rate of loan

portfolio 2.1% (June 30, 2015 2.8%)

0.0 50.0 100.0 150.0 200.0 250.0 300.0 350.0 Bonds Bank loans Commercial Papers Other

slide-24
SLIDE 24

Free cash flow

28 July 2016 24

  • 150
  • 100
  • 50

50 100 150 200

Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16

Cash flow from operating activities – net capital expenditures – restricted cash Net capital expenditure = total capital expenditure less proceeds from sale of assets

Amer Sports Interim Report Presentation

slide-25
SLIDE 25

Impact of new ESMA guidelines

New ESMA (European Securities and Markets Authority) guidelines

  • n Alternative Performance Measures (APMs) are effective for the

financial year 2016. Amer Sports presents APMs to reflect the underlying business performance and to enhance comparability between financial periods. APMs should not be considered as a substitute for measures of performance in accordance with the IFRS. As of Q1 2016, Amer Sports relabels the previously referenced "excluding non-recurring items" with "excluding items affecting comparability” (IAC). Operating segments’ EBIT is reported excluding

  • IAC. Items affecting comparability and APMs used by Amer Sports

are defined in note 10 of the Q2 interim report.

28 July 2016 Amer Sports Interim Report Presentation 25

slide-26
SLIDE 26

Changes to Amer Sports Insider Register and Disclosure Policy as of July 3, 2016

Notification and publication of transactions of managers and their closely associated persons

  • The following persons have been deemed to discharge managerial

responsibilities in Amer Sports:

  • Members and secretary of the Board of Directors
  • CEO
  • Members of the Executive Board

28 July 2016 Amer Sports Interim Report Presentation 26

slide-27
SLIDE 27

Contact information

  • Heikki Takala, President and CEO
  • Tel. +358 20 712 2510
  • Jussi Siitonen, CFO
  • Tel. +358 20 7122511
  • Päivi Antola, Director, Corporate Communications and IR
  • Tel. +358 20 712 2537
  • www.amersports.com

28 July 2016 27 Amer Sports Interim Report Presentation

slide-28
SLIDE 28

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

28 July 2016 28 Amer Sports Interim Report Presentation

slide-29
SLIDE 29