Amer Sports Corporation Interim Report January-September 2012
(Thomson Reuters ONE) -
Amer Sports Corporation
INTERIM REPORT
October 25, 2012 at 1:00 pm
JULY-SEPTEMBER 2012
* Net sales totaled EUR 601.9 million (July-September 2011: EUR 559.2
million). In local currencies, net sales increased by 2%. Strong growth in
Apparel (+27%), Sports Instruments (+24%) and Fitness (+10%) was offset by a
decline in Winter Sports Equipment (-15%).
* Gross margin was 45.3% (45.3%).
* EBIT was EUR 80.8 million (74.4).
* Earnings per share were EUR 0.47 (0.45).
* Net cash flow after investing activities improved EUR 12.3 million and was
EUR -78.1 million (-90.4).
* Amer Sports is starting a restructuring program in order to sustain growth
and to drive further scale and synergies. The program is estimated to
deliver an annual cost saving of EUR 20 million once fully executed by the
end of 2014 (please see page 9).
* Outlook for 2012 is unchanged.
JANUARY-SEPTEMBER 2012
* Net sales were EUR 1,445.5 million (January-September 2011: EUR 1,323.9
million). In local currencies, net sales increased by 4%.
* Gross margin rose to 44.4% (43.9%).
* EBIT was EUR 90.0 million (89.2).
* Earnings per share were EUR 0.43 (0.46).
* Net cash flow after investing activities was EUR -24.9 million (-70.4).
* Gearing was 70% (55%). The increase was due to the redemption of the hybrid
bond in March (impact 12 percentage points).
OUTLOOK FOR 2012
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.
KEY FIGURES
7-9/ 7-9/ Ch Ch 1-9/ 1-9/ Ch Ch
EUR million 2012 2011 % %*) 2012 2011 % %*) 2011
-------------------------------------------------------------------------------
Net sales 601.9 559.2 8 2 1,445.5 1,323.9 9 4 1,880.8
Gross profit 272.9 253.4 8 2 641.7 581.5 10 5 817.4
Gross profit % 45.3 45.3 44.4 43.9 43.5
EBIT 80.8 74.4 9 2 90.0 89.2 1 -7 135.5
EBIT % 13.4 13.3 6.2 6.7 7.2
Financing income and
expenses -6.2 -5.3 -20.4 -14.4 -20.5
Earnings before taxes 74.6 69.1 69.6 74.8 115.0
Net result 55.9 55.3 52.2 59.8 90.9
Earnings per share, EUR 0.47 0.45 0.43 0.46 0.71
Net cash flow after investing
activities -78.1 -90.4 -24.9 -70.4 -21.4
Equity ratio, % at period end 39.7 44.0 45.6
Gearing, % at period end 70 55 47
Personnel at period end 7,280 7,107 2 7,061
Average rates used, EUR/USD 1.28 1.41 1.39
*) Change in local currencies
HEIKKI TAKALA, PRESIDENT AND CEO:
"Our Q3 sales were driven by strong on-going momentum in Apparel (27% growth),
as well as continuous improvement in Suunto (+24%), Fitness (10%), Tennis (+8%)
and Cycling (+7%). As expected, Winter Sports Equipment declined in line with
the previously communicated low pre-orders, despite our strengthened market
position.
The external trading environment is admittedly quite challenging, but we have
successfully continued to execute our strategic programs with extra focus on
working capital management and especially the health of our inventories. We have
also continued to invest into the long-term strategic programs, like expansion
in China and Russia, own retail and softgoods. Now the majority of the new
capabilities are starting to be in place. In order to sustain the growth, and to
drive further scale and synergies, we're also starting a group-wide
restructuring program.
I'm overall pleased by our progress, especially as we have been able to largely
mitigate the Winter Sports Equipment decline and the challenging trading
environment. We are progressing well in our strategic glidepath, and we continue
executing with confidence."
For further information, please contact:
Heikki Takala, President and CEO, tel. +358 9 7257 8210
Jussi Siitonen, CFO, tel. +358 9 7257 8212
Päivi Antola, Director, Corporate Communications and IR, tel. +358 9 7257 8233
TELEPHONE CONFERENCE
An English-language conference call for investors and analysts will be held
today at 3:00 pm Finnish time. To participate in the call, please dial +44 (0)20
3450 9987 (UK/international dial-in number). The conference can also be followed
at www.amersports.com. A recorded version and a transcript will be available
later at the same web address. The replay number of the call is
+44 (0)20 3427 0598, and the access code 6426572.
INTERIM REPORT
NET SALES AND EBIT JULY-SEPTEMBER 2012
Amer Sports' net sales in July-September 2012 were EUR 601.9 million (July-
September 2011: 559.2). Net sales increased by 2% in local currencies.
Net sales by business segment
7-9/ 7-9/ Change Change % of sales % of sales
EUR million 2012 2011 % %*) 7-9/2012 7-9/2011 2011
--------------------------------------------------------------------------
Winter and Outdoor 411.0 395.7 4 -1 68 71 1,137.6
Ball Sports 121.9 106.7 14 4 20 19 511.0
Fitness 69.0 56.8 21 10 12 10 232.2
--------------------------------------------------------------------------
Total 601.9 559.2 8 2 100 100 1,880.8
--------------------------------------------------------------------------
*) In local currencies
Geographic breakdown of net sales
7-9/ 7-9/ Change Change % of sales % of sales
EUR million 2012 2011 % %*) 7-9/2012 7-9/2011 2011
--------------------------------------------------------------------
EMEA 297.6 300.0 -1 -2 50 54 917.6
Americas 236.2 203.8 16 4 39 36 742.1
Asia Pacific 68.1 55.4 23 12 11 10 221.1
--------------------------------------------------------------------
Total 601.9 559.2 8 2 100 100 1,880.8
--------------------------------------------------------------------
*) In local currencies
Gross margin was 45.3% (45.3).
Group EBIT was EUR 80.8 million (74.4). Increased sales volumes contributed
approximately EUR 5 million to EBIT. Operating expenses increased by
approximately EUR 7 million, which was offset by foreign exchange gains.
EBIT by business segment
7-9/ 7-9/
EUR million 2012 2011 2011
----------------------------------
Winter and Outdoor 86.8 79.3 118.5
Ball Sports -2.6 -1.1 25.0
Fitness 4.2 2.8 10.3
Headquarters*) -7.6 -6.6 -18.3
----------------------------------
Total 80.8 74.4 135.5
----------------------------------
*) Headquarters segment consists of Group administration, shared services
functions, other non-operational income and expenses and fair valuation of
share-based compensations. In the third quarter of 2012, segment operating loss
increased by EUR 1.0 million due to increased operational expenses and change in
fair valuation of share-based compensations and other adjustments.
Net financial expenses were EUR 6.3 million (5.3) including net interest
expenses of EUR 6.3 million (4.6). Net foreign exchange losses were EUR 0.5
million (0.6). Earnings before taxes totaled EUR 74.6 million (69.1) and taxes
were EUR 18.7 million (13.8). Earnings per share were EUR 0.47 (0.45).
NET SALES AND EBIT JANUARY-SEPTEMBER 2012
Amer Sports' net sales in January-September 2012 were EUR 1,445.5 million
(January-September 2011: EUR 1,323.9 million). Comparable net sales increased by
4% in local currencies.
Net sales by business segment
1-9/ 1-9/ Change Change % of sales % of sales
EUR million 2012 2011 % %*) 1-9/2012 1-9/2011 2011
------------------------------------------------------------------------------
Winter and Outdoor 818.4 762.6 7 4 57 58 1,137.6
Ball Sports 442.0 402.0 10 3 30 30 511.0
Fitness 185.1 159.3 16 7 13 12 232.2
------------------------------------------------------------------------------
Total 1,445.5 1,323.9 9 4 100 100 1,880.8
------------------------------------------------------------------------------
*) In local currencies
Geographic breakdown of net sales
1-9/ 1-9/ Change Change % of sales % of sales
EUR million 2012 2011 % %*) 1-9/2012 1-9/2011 2011
------------------------------------------------------------------------
EMEA 657.4 643.8 2 1 46 49 917.6
Americas 609.3 536.7 14 4 42 40 742.1
Asia Pacific 178.8 143.4 25 15 12 11 221.1
------------------------------------------------------------------------
Total 1,445.5 1,323.9 9 4 100 100 1,880.8
------------------------------------------------------------------------
*) In local currencies
Gross margin was 44.4% (43.9).
Group EBIT was EUR 90.0 million (89.2). In local currencies, increased sales
volumes contributed approximately EUR 23 million to EBIT, while higher gross
margins contributed approximately EUR 8 million. Operating expenses increased by
approximately EUR 39 million, driven by continuous investments into future
growth with focus on softgoods, sales coverage, emerging markets, and own
retail. Other income and expenses and currencies impacted positively by
approximately EUR 9 million on EBIT.
EBIT by business segment
1-9/ 1-9/
EUR million 2012 2011 2011
------------------------------------
Winter and Outdoor 72.1 73.5 118.5
Ball Sports 27.0 25.7 25.0
Fitness 9.1 5.8 10.3
Headquarters*) -18.2 -15.8 -18.3
------------------------------------
Total 90.0 89.2 135.5
------------------------------------
*) Headquarters segment consists of Group administration, shared services
functions, other non-operational income and expenses and fair valuation of
share-based compensations. In January-September 2012, segment operating loss
increased by EUR 2.4 million due to increased operational expenses and change in
fair valuation of share-based compensations and other adjustments.
Net financial expenses totaled EUR 20.4 million (14.4) including net interest
expenses of EUR 18.5 million (13.8). Net foreign exchange losses totaled EUR
0.3 million (0.5). Earnings before taxes totaled EUR 69.6 million (74.8) and
taxes were EUR 17.4 million (15.0). Earnings per share were EUR 0.43 (0.46).
CASH FLOW AND FINANCING
Net cash flow after investing activities (free cash flow) in January-September
was EUR -24.9 million (-70.4). Working capital in total increased by EUR 79.9
million (132.1). Inventories increased by EUR 40.9 million (86.2) and
receivables by EUR 19.4 million (51.9) and payables decreased by EUR 19.6
million (increase 6.0).
At the end of September, net debt amounted to EUR 539.3 million (December
31, 2011: 391.6). The increase was due to redemption of a hybrid bond of EUR
60.0 million and its interests of EUR 7.2 million, dividends of EUR 38.9 (36.4)
million and foreign exchange derivatives used in hedging. The hybrid bond was
issued on March 12, 2009 and redeemed on March 12, 2012.
Interest-bearing liabilities amounted to EUR 660.8 million (December
31, 2011: 470.4) consisting of short-term debt of EUR 246.0 million and long-
term debt of EUR 414.8 million. The average interest rate on the Group's
interest-bearing liabilities was 3.4% (December 31, 2011: 3.6).
Short-term debt consists mainly of repayments of long-term loans of EUR 12.4
million (December 31, 2011: 23.4) and commercial papers of EUR 229.1 (194.2).
The total size of the commercial paper program is EUR 500 million.
Cash and cash equivalents totaled EUR 121.5 million (December 31, 2011: 78.8).
In 2011, Amer Sports signed a syndicated loan that consists of a EUR 200 million
revolving credit facility. In June 2012, Amer Sports signed a 5-year EUR 40
million committed revolving credit facility with Pohjola Bank. Amer Sports had
not used any of the revolving credit facility or the EUR 40 million committed
revolving credit facility of Pohjola Bank at the end of the review period. The
credit facilities will be used for general corporate purposes.
In March 2012, Amer Sports issued two euro denominated bonds. The amount of EUR
150 million was launched and placed on the following terms: EUR 50 million
floating rate notes due March 6, 2014; and EUR 100 million fixed 4.125% notes
due March 15, 2016. The bonds were listed on the NASDAQ OMX Helsinki Ltd on July
27, 2012. In April 2012, Amer Sports signed a 3-year EUR 20 million term loan
with Unicredit Bank Austria AG. The proceeds of the bonds and term loan have
been used for repayment of debt and general corporate purposes.
The equity ratio at the end of September was 39.7% (December 31, 2011: 45.6) and
gearing was 70% (December 31, 2011: 47).
CAPITAL EXPENDITURE AND INVESTMENTS
The Group's capital expenditure totaled EUR 30.4 million (28.9). Depreciation
totaled EUR 30.1 million (26.0). The whole year capital expenditure is expected
to be approximately EUR 50 million (51.4).
BUSINESS SEGMENT REVIEWS
WINTER AND OUTDOOR
7-9/ 7-9/ Ch Ch 1-9/ 1-9/ Ch Ch
EUR million 2012 2011 % %*) 2012 2011 % %*) 2011
--------------------------------------------------------------------------
Net sales
Winter Sports Equipment 163.7 185.4 -12 -15 221.8 243.4 -9 -12 448.4
Footwear 92.9 90.7 2 0 253.7 236.7 7 5 287.7
Apparel 95.0 69.5 37 27 171.6 125.8 36 29 191.6
Cycling 31.3 28.7 9 7 97.2 91.0 7 5 120.5
Sports Instruments 28.1 21.4 31 24 74.1 65.7 13 16** 89.4
Net sales, total 411.0 395.7 4 -1 818.4 762.6 7 4 1,137.6
EBIT 86.8 79.3 9 72.1 73.5 -2 118.5
Personnel at period end 4,765 4,663 2 4,590
*) Change in local currencies
**) Underlying growth excluding the businesses divested in 2011
In July-September, Winter and Outdoor's net sales were EUR 411.0 million
(395.7), and were at last year's level in local currencies.
7-9/ 7-9/ Ch Ch 1-9/ 1-9/ Ch Ch
EUR million 2012 2011 % %*) 2012 2011 % %*) 2011
----------------------------------------------------------
EMEA 252.3 260.2 -3 -4 508.6 509.4 0 -1 751.3
Americas 118.5 101.6 17 4 210.5 175.5 20 10 253.4
Asia Pacific 40.2 33.9 19 10 99.3 77.7 28 18 132.9
----------------------------------------------------------
Total 411.0 395.7 4 -1 818.4 762.6 7 4 1,137.6
----------------------------------------------------------
*) Change in local currencies
In July-September, EBIT was EUR 86.8 million (79.3). Higher gross margins
contributed approximately EUR 6 million to the EBIT growth. Operating expenses
increased by approximately EUR 8 million, which was offset by foreign exchange
gains.
Winter Sports Equipment
In July-September, Winter Sports Equipment's net sales were EUR 163.7 million
(185.4), a decrease of 15% in local currencies due to lower pre-orders (down by
13%) and later deliveries compared to 2011.
Footwear
In July-September, Footwear's net sales were EUR 92.9 million (90.7), and were
at last year's level in local currencies due to customer de-stocking in Europe,
which represents 75% of Footwear's annual net sales (2011). Sales in Russia,
Americas and Asia Pacific continued to increase.
Apparel
In July-September, Apparel's net sales were EUR 95.0 million (69.5), an increase
of 27% in local currencies. Growth came from both main brands, Salomon and
Arc'teryx. The third quarter is traditionally the Apparel business' biggest
quarter of the year.
Cycling
In July-September, Cycling's net sales were EUR 31.3 million (28.7), an increase
of 7% in local currencies. Especially Rider Equipment continued to grow
(helmets, apparel and footwear).
Sports Instruments
In July-September, Sports Instruments' net sales were EUR 28.1 million (21.4),
an increase of 24% in local currencies. The growth was supported by strengthened
distribution together with strong sales of the Suunto GPS watch, which was
launched during the first quarter 2012.
BALL SPORTS
7-9/ 7-9/ Ch Ch 1-9/ 1-9/ Ch Ch
EUR million 2012 2011 % %*) 2012 2011 % %*) 2011
---------------------------------------------------------------------
Net sales
Individual Ball Sports 72.1 61.6 17 8 257.0 231.1 11 5 283.0
Team Sports 49.8 45.1 10 -1 185.0 170.9 8 0 228.0
Net sales, total 121.9 106.7 14 4 442.0 402.0 10 3 511.0
EBIT -2.6 -1.1 27.0 25.7 5 25.0
Personnel at period end 1,593 1,620 -2 1,631
*) Change in local currencies
In July-September, Ball Sports' net sales were EUR 121.9 million (106.7), an
increase of 4% in local currencies. Growth was achieved throughout the Ball
Sports business with the exception of baseball bats, which decreased as trade
was de-stocking their inventories.
7-9/ 7-9/ Ch Ch 1-9/ 1-9/ Ch Ch
EUR million 2012 2011 % %*) 2012 2011 % %*) 2011
--------------------------------------------------------
EMEA 23.9 23.9 0 -3 99.5 96.2 3 2 113.4
Americas 77.8 67.7 15 3 280.4 255.9 10 1 331.0
Asia Pacific 20.2 15.1 34 20 62.1 49.9 24 14 66.6
--------------------------------------------------------
Total 121.9 106.7 14 4 442.0 402.0 10 3 511.0
--------------------------------------------------------
*) Change in local currencies
In July-September, EBIT was EUR -2.6 million (-1.1). The decrease in EBIT was
driven by a decline in margins in baseball.
Individual Ball Sports
In July-September, Individual Ball Sports' net sales were EUR 72.1 million
(61.6), an increase of 8% in local currencies. Sales of both Racquet Sports and
Golf grew. From a regional perspective, Individual Ball Sports grew in Asia
Pacific and the Americas but declined slightly in EMEA.
Team Sports
In July-September, Team Sports' net sales were EUR 49.8 million (45.1), and were
at last year's level in local currencies.
FITNESS
7-9/ 7-9/ Ch Ch 1-9/ 1-9/ Ch Ch
EUR million 2012 2011 % %*) 2012 2011 % %*) 2011
-----------------------------------------------------------------
Net sales 69.0 56.8 21 10 185.1 159.3 16 7 232.2
EBIT 4.2 2.8 50 9.1 5.8 57 10.3
Personnel at period end 796 750 6 749
*) Change in local currencies
In July-September, Fitness' net sales were EUR 69.0 million (56.8), an increase
of 10% in local currencies. Geographically, sales were up especially in EMEA due
to investments into sales and distribution.
The commercial business (clubs and institutions) was up by 9% in local
currencies. Consumer business (home use) was up by 28%.
7-9/ 7-9/ Ch Ch 1-9/ 1-9/ Ch Ch
EUR million 2012 2011 % %*) 2012 2011 % %*) 2011
------------------------------------------------------
EMEA 21.4 15.9 35 28 49.3 38.2 29 24 52.9
Americas 39.9 34.5 16 3 118.4 105.3 12 3 157.7
Asia Pacific 7.7 6.4 20 6 17.4 15.8 10 -1 21.6
------------------------------------------------------
Total 69.0 56.8 21 10 185.1 159.3 16 7 232.2
------------------------------------------------------
*) Change in local currencies
In July-September, EBIT was EUR 4.2 million (2.8). The increase was driven by
higher sales volumes.
PERSONNEL
At the end of September, the number of Group employees was 7,280 (December
31, 2011: 7,061). The increase came mainly from personnel working in sales and
distribution. The increase in Headquarters and shared services was due to
establishing a shared financial service center in the EMEA region, which will
bring scale and synergy benefits.
September 30, September 30, December 31,
2012 2011 2011
-------------------------------------------------------------------------
Winter and Outdoor 4,765 4,663 4,590
Ball Sports 1,593 1,620 1,631
Fitness 796 750 749
Headquarters and shared services 126 74 91
-------------------------------------------------------------------------
Total 7,280 7,107 7,061
-------------------------------------------------------------------------
September 30, September 30, December 31,
2012 2011 2011
-----------------------------------------------------
EMEA 4,269 4,258 4,185
Americas 2,339 2,289 2,312
Asia Pacific 672 560 564
-----------------------------------------------------
Total 7,280 7,107 7,061
-----------------------------------------------------
SHARES AND SHAREHOLDERS
The company's share capital totaled EUR 292,182,204 on September 30, 2012 and
the number of shares was 118,517,285.
Authorizations
The Annual General Meeting held on March 8, 2012 authorized the Board of
Directors to decide on the repurchase of a maximum of 10,000,000 of the
company's own shares ("Repurchase Authorization"). The company's own shares
shall be repurchased otherwise than in proportion to the holdings of the
shareholders by using the non-restricted equity through public trading on the
Nasdaq OMX Helsinki at the market price prevailing at the time of acquisition.
The shares shall be repurchased and paid for in accordance with the rules of the
Nasdaq OMX Helsinki and Euroclear Finland Ltd. The Repurchase Authorization is
valid 18 months from the decision of the Annual General Meeting.
Amer Sports Board of Directors decided on January 31, 2012 to utilize the
authorization given by the Annual General Meeting held on March 10, 2011 to
cancel a total of 3,000,000 own shares held by the company, which equates to
approximately 2.5% of the registered number of shares. The cancellation did not
affect the company's share capital.
Based on the Board of Directors' decision, a total of 280,029 Amer Sports shares
were transferred on March 8, 2012 to the personnel involved in the company's
Performance Share Plan 2010 and the Restricted Stock Plan 2010. The shares were
transferred from the shares owned by Amer Sports Corporation.
At the end of September, Amer Sports held a total of 738,505 shares of Amer
Sports Corporation. The number of own shares corresponds to 0.62% (0.83) of all
Amer Sports shares. A total of 6,409 shares granted as share-based incentives
were returned to Amer Sports in July-September in accordance with the terms of
the incentive plan as employment ended.
Trading in shares
In January-September, a total of 52.8 million (57.4) Amer Sports shares with a
value totaling EUR 513.5 million (570.7) were traded on the NASDAQ OMX Helsinki
Ltd in the review period. The average daily volume in January-September 2012 was
279,145 shares (301,976).
The closing price of the Amer Sports Corporation share on the NASDAQ OMX
Helsinki Ltd stock exchange on September 30, 2012 was EUR 10.12 (9.49). Shares
registered a high of EUR 11.00 (11.97) and a low of EUR 8.39 (7.52) during the
review period. The average share price was EUR 9.73 (9.95). On September
30, 2012, the company had a market capitalization of EUR 1,191.9 million
(1,122.0), excluding own shares.
Amer Sports Corporation had 15,734 registered shareholders (15,911) at the end
of September 2012. Outside Finland, ownership and nominee registrations
represented 41.7% (49.3%) of the company's shares.
DECISIONS OF THE ANNUAL GENERAL MEETING OF SHAREHOLDERS
Documentation and press releases relating to the resolutions approved by the
Amer Sports Corporation Annual General Meeting held on March 8, 2012 are
available on the company's website at www.amersports.com/investors.
GROUP-WIDE RESTRUCTURING PROGRAM TO BE STARTED
Amer Sports is starting a restructuring program to drive further scale and
synergies and cost efficiencies, as well as to sustain growth through resource
allocation especially into softgoods and expansion markets and channels. The
program is estimated to deliver an annual cost saving of EUR 20 million once
fully executed by the end of 2014. The program contributes to reaching the
Group's long term profitability target of 10% EBIT.
The restructuring program is Group-wide, and focused on the following key areas:
* Driving further scale and synergies and decreasing complexity and
duplication in all business areas, regions, functions, sites and platforms
* Further reducing weather dependency in Winter Sports Equipment through
reduction of fixed operating costs, following the operational model
restructuring program started in 2010, which is now completed
* Resource allocation to support growth in softgoods as well as expansion
markets and channels.
Further details on the restructuring program and the non-recurring expenses
related to the program will be announced in connection with the fourth-quarter
results announcement.
SIGNIFICANT RISKS AND UNCERTAINTIES
Amer Sports' business is balanced by its broad portfolio of sports and brands,
as well as its presence in all major markets. Short-term risks for Amer Sports
are particularly associated with the late and mild winter in season 2011/12 and
its impact on Winter Sports Equipment, with consumer demand development in North
America, Europe and Japan, with labor and raw material price inflation,
especially in China, and with Amer Sports' ability to manufacture, source and
deliver products on a timely basis.
Further information on the company's business risks and uncertainty factors is
available on the company's web site at www.amersports.com/investors.
OUTLOOK FOR 2012
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.
Outlook given in the interim report on August 2, 2012
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.
For the full year, Apparel net sales growth is estimated to be over 20%. In
Footwear, sales growth is estimated to be approximately 5% due to retailers'
inventory reduction. In Apparel and Footwear, the company no longer provides
semi-annual pre-order figures as Amer Sports considers that these are not a
reliable indicator of the future growth. In Winter Sports Equipment, Amer Sports
has gained market shares and strengthened its market position but pre-orders for
the season 2012/13 are down by 13% due to the late and mild winter in the
previous season.
Amer Sports is continuously driving synergies and scale and continues to invest
into future growth with focus on softgoods, sales coverage, emerging markets,
and own retail. These investments support Amer Sports' sales and gross margin
improvement but require up-front operational expenses. Amer Sports 2012 EBIT
excluding non-recurring items is expected to be approximately at the level of
2011 despite the uncertainty in the winter sports market and the ongoing
investments into the future growth.
TABLES
The notes are an integral part of consolidated interim financial information.
Unaudited
EUR million
CONSOLIDATED RESULTS
7-9/ 7-9/ Change 1-9/ 1-9/ Change
2012 2011 % 2012 2011 % 2011
--------------------------------------------------------------------------------
NET SALES 601.9 559.2 8 1,445.5 1,323.9 9 1,880.8
Cost of goods sold -329.0 -305.8 -803.8 -742.4 -1,063.4
--------------------------------------------------------------------------------
GROSS PROFIT 272.9 253.4 8 641.7 581.5 10 817.4
License income 1.6 2.0 5.5 6.4 8.7
Other operating income 1.6 1.4 4.7 2.8 5.4
R&D expenses -17.7 -14.4 -51.5 -43.6 -64.2
Selling and marketing -130.1
expenses -117.5 -380.7 -337.6 -475.9
Administrative and other
expenses -47.5 -50.5 -129.7 -120.3 -155.9
--------------------------------------------------------------------------------
EARNINGS BEFORE
INTEREST AND TAXES 80.8 74.4 9 90.0 89.2 1 135.5
% of net sales 13.4 13.3 6.2 6.7 7.2
Financing income and
expenses -6.2 -5.3 -20.4 -14.4 -20.5
--------------------------------------------------------------------------------
EARNINGS BEFORE TAXES 74.6 69.1 69.6 74.8 115.0
Taxes -18.7 -13.8 -17.4 -15.0 -24.1
--------------------------------------------------------------------------------
NET RESULT 55.9 55.3 52.2 59.8 90.9
--------------------------------------------------------------------------------
Attributable to:
Equity holders of the
parent
company 55.9 55.2 52.2 59.7 90.8
Non-controlling interests - 0.1 - 0.1 0.1
Earnings per share, EUR 0.47 0.45 0.43 0.46 0.71
Earnings per share, 0.47
diluted, EUR 0.45 0.43 0.46 0.71
Adjusted average number of
shares in issue less own
shares, million 117.7 120.5 119.9
Adjusted average number of
shares in issue less own
shares,
diluted, million 118.1 120.9 120.1
Equity per share, EUR 6.50 6.64 7.03
ROCE, % *) 12.2 13.7 13.2
ROE, % 8.7 10.1 11.2
Average rates used:
EUR 1.00 = USD 1.2478 1.4144 1.2809 1.4068 1.3926
*) 12 months' rolling average
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
7-9/ 7-9/ 1-9/ 1-9/
2012 2011 2012 2011 2011
---------------------------------------------------------
Net result 55.9 55.3 52.2 59.8 90.9
Other comprehensive income
Translation differences -7.7 21.2 1.0 -4.8 7.7
Cash flow hedges -11.4 17.3 -15.4 10.6 17.3
Income tax related to
cash flow hedges 3.0 -4.5 4.0 -2.8 -4.5
---------------------------------------------------------
Other comprehensive income,
net of tax -16.1 34.0 -10.4 3.0 20.5
---------------------------------------------------------
Total comprehensive income 39.8 89.3 41.8 62.8 111.4
---------------------------------------------------------
Total comprehensive income
attributable to:
Equity holders of the parent
company 39.8 89.2 41.8 62.7 111.3
Non-controlling interests - 0.1 - 0.1 0.1
NET SALES BY BUSINESS SEGMENT
7-9/ 7-9/ Change 1-9/ 1-9/ Change
2012 2011 % 2012 2011 % 2011
----------------------------------------------------------------------
Winter and Outdoor 411.0 395.7 4 818.4 762.6 7 1,137.6
Ball Sports 121.9 106.7 14 442.0 402.0 10 511.0
Fitness 69.0 56.8 21 185.1 159.3 16 232.2
----------------------------------------------------------------------
Total 601.9 559.2 8 1,445.5 1,323.9 9 1,880.8
----------------------------------------------------------------------
GEOGRAPHIC BREAKDOWN OF NET SALES
7-9/ 7-9/ Change 1-9/ 1-9/ Change
2012 2011 % 2012 2011 % 2011
--------------------------------------------------------------
EMEA 297.6 300.0 -1 657.4 643.8 2 917.6
Americas 236.2 203.8 16 609.3 536.7 14 742.1
Asia Pacific 68.1 55.4 23 178.8 143.4 25 221.1
--------------------------------------------------------------
Total 601.9 559.2 8 1,445.5 1,323.9 9 1,880.8
--------------------------------------------------------------
EBIT BY BUSINESS SEGMENT
7-9/ 7-9/ Change 1-9/ 1-9/ Change
2012 2011 % 2012 2011 % 2011
------------------------------------------------------------
Winter and Outdoor 86.8 79.3 9 72.1 73.5 -2 118.5
Ball Sports -2.6 -1.1 27.0 25.7 5 25.0
Fitness 4.2 2.8 50 9.1 5.8 57 10.3
Headquarters -7.6 -6.6 -18,2 -15.8 -18.3
------------------------------------------------------------
Total 80.8 74.4 9 90.0 89.2 1 135.5
------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT
7-9/ 7-9/ 1-9/ 1-9/
Note 2012 2011 2012 2011 2011
------------------------------------------------------------------------------
Earnings before interest and taxes 80.8 74.4 90.0 89.2 135.5
Adjustments to cash flow from
operating activities and depreciation 13.5 8.4 29.8 26.9 37.9
Change in working capital -162.3 -154.6 -79.9 -132.1 -97.6
------------------------------------------------------------------------------
Cash flow from operating activities
before financing items and taxes -68.0 -71.8 39.9 -16.0 75.8
Interest paid and received -2.6 -1.2 -17.6 -13.3 -20.5
Income taxes paid and received -9.5 -7.7 -25.3 -18.0 -24.7
------------------------------------------------------------------------------
Net cash flow from operating activities -80.1 -80.7 -3.0 -47.3 30.6
Acquired operations - - - - -6.5
Sold operations - - 1.1 5.3 5.3
Acquired non-controlling interests - - -3.7 - -
Capital expenditure on non-current
tangible and intangible assets -8.7 -9.9 -30.4 -28.9 -51.4
Proceeds from sale of tangible non-
current assets 10.7 0.2 11.1 0.5 0.6
------------------------------------------------------------------------------
Net cash flow from investing activities 2.0 -9.7 -21.9 -23.1 -52.0
Net cash flow after investing activities
(free cash flow) -78.1 -90.4 -24.9 -70.4 -21.4
Repurchase of own shares - -18.0 - -27.2 -36.7
Hybrid bond 4 - - -67.2 -7.2 -7.2
Dividends paid 5 - - -38.9 -36.4 -36.4
Change in debt and other financing
items -17.1 137.3 173.4 132.3 94.9
------------------------------------------------------------------------------
Net cash flow from financing activities -17.1 119.3 67.3 61.5 14.6
Cash and cash equivalents on
July 1/January 1 216.7 46.0 78.8 84.7 84.7
Translation differences - 0.7 0.3 -0.2 0.9
Change in cash and cash equivalents -95.2 28.9 42.4 -8.9 -6.8
------------------------------------------------------------------------------
Cash and cash equivalents on
September 30/December 31 121.5 75.6 121.5 75.6 78.8
------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEET
September September December
Note 30, 2012 30, 2011 31, 2011
----------------------------------------------------------------------------
Assets
----------------------------------------------------------------------------
Goodwill 292.8 285.0 295.7
Other intangible non-current assets 210.2 205.7 214.5
Tangible non-current assets 155.7 146.3 157.8
Other non-current assets 100.4 98.8 99.6
Inventories and work in progress 403.5 384.6 359.7
Receivables 645.3 590.5 611.9
Cash and cash equivalents 121.5 75.6 78.8
----------------------------------------------------------------------------
Total assets 2 1,929.4 1,786.5 1,818.0
----------------------------------------------------------------------------
Shareholders' equity and liabilities
----------------------------------------------------------------------------
Shareholders' equity 765.6 786.1 829.4
Long-term interest-bearing liabilities 414.8 330.0 251.4
Other long-term liabilities 23.5 20.4 22.7
Current interest-bearing liabilities 246.0 174.7 219.0
Other current liabilities 450.0 446.5 463.1
Provisions 29.5 28.8 32.4
----------------------------------------------------------------------------
Total shareholders' equity and liabilities 1,929.4 1,786.5 1,818.0
----------------------------------------------------------------------------
Equity ratio, % 39.7 44.0 45.6
Gearing, % 70 55 47
EUR 1.00 = USD 1.2930 1.3503 1.2939
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
Fair Inves-
Fund Trans- value ted
Sh- Pre- for lation and unre- Retai-
are mi- own diffe- other stricted ned
capi- um sha- ren- reser- equity Hybrid ear-
Note tal fund res ces ves reserve bond nings Total
-----------------------------------------------------------------------------
Balance at
Jan. 1,
2011 292.2 12.1 -5.6 -34.3 -5.6 151.5 60.0 317.3 787.6
Other
compre-
hensive
income:
Translation
differences -4.8 -4,8
Cash flow
hedges 10.6 10.6
Income tax
related to
cash flow
hedges -2.8 -2.8
Net result 59.7 59.7
Total
compre-
hensive
income -4.8 7.8 59.7 62.7
Transact-
ions with
owners:
Repurch-
ase of
own
shares -29.7 -29.7
Share-
based
incentive
programs 5.4 1.0 6.4
Interest on
hybrid
bond -7.2 -7.2
Dividend
distribution 5 -36.3 -36.3
-----------------------------------------------------------------------------
Balance at
Sep. 30,
2011 292.2 12.1 -29.9 -39.1 2.2 151.5 60.0 334.5 783.5
Balance at
Jan. 1,
2012 292.2 12.1 -36.9 -26.6 7.2 151.5 60.0 367.3 826.8
Other
compre-
hensive
income:
Translation
differences 1.0 1.0
Cash flow
hedges -15.4 -15.4
Income tax
related to
cash flow
hedges 4.0 4.0
Net result 52.2 52.2
Total
compre-
hensive
income 1.0 -11.4 52.2 41.8
Transact-
ions with
owners:
Cancella-
tion of own
shares 27.2 -27.2 0.0
Share-
based
incentive
programs 2.6 2.9 -2.4 3.1
Hybrid
bond 4 -60.0 -7.2 -67.2
Dividend
distribution 5 -38.9 -38.9
-----------------------------------------------------------------------------
Balance at
Sep. 30,
2012 292.2 12.1 -7.1 -25.6 -4.2 154.4 - 343.8 765.6
Total
Non- share-
cont- hold-
rolling ers'
inte- equ-
Note rests ity
--------------------------------
Balance at
Jan. 1,
2011 2.6 790.2
Other
compre-
hensive
income:
Translation
differences -4.8
Cash flow
hedges 10.6
Income tax
related to
cash flow
hedges -2.8
Net result 0.1 59.8
Total
compre-
hensive
income 0.1 62.8
Transact-
ions with
owners:
Repurch-
ase of
own
shares -29.7
Share-
based
incentive
programs 6.4
Interest on
hybrid
bond -7.2
Dividend
distribution 5 -0.1 -36.4
--------------------------------
Balance at
Sep.30,
2011 2.6 786.1
Balance at
Jan. 1,
2012 2.6 829.4
Other
compre-
hensive
income:
Translation
differences 1.0
Cash flow
hedges -15.4
Income tax
related to
cash flow
hedges 4.0
Net result 52.2
Total
compre-
hensive
income 41.8
Transact-
ions with
owners:
Share-
based
incentive
programs 3.1
Hybrid
bond 4 -67.2
Dividend
distribution 5 -38.9
Other
change -2.6 -2.6
--------------------------------
Balance at
Sep. 30,
2012 - 765.6
QUARTERLY BREAKDOWN OF NET SALES AND EBIT
Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ Q4/
NET SALES 2012 2012 2012 2011 2011 2011 2011 2010
------------------------------------------------------------------
Winter and Outdoor 411.0 150.9 256.5 375.0 395.7 133.4 233.5 416.5
Ball Sports 121.9 146.5 173.6 109.0 106.7 136.3 159.0 107.3
Fitness 69.0 56.4 59.7 72.9 56.8 45.9 56.6 59.6
------------------------------------------------------------------
Total 601.9 353.8 489.8 556.9 559.2 315.6 449.1 583.4
------------------------------------------------------------------
Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ Q4/
EBIT 2012 2012 2012 2011 2011 2011 2011 2010
------------------------------------------------------------------
Winter and Outdoor 86.8 -25.4 10.7 45.0 79.3 -15.1 9.3 51.2
Ball Sports -2.6 9.7 19.9 -0.7 -1.1 9.1 17.7 -5.4
Fitness 4.2 1.0 3.9 4.5 2.8 -0.3 3.3 2.0
Headquarters -7.6 -5.1 -5.5 -2.5 -6.6 -4.6 -4.6 0.6
------------------------------------------------------------------
Total 80.8 -19.8 29.0 46.3 74.4 -10.9 25.7 48.4
------------------------------------------------------------------
THE NOTES TO THE FINANCIAL STATEMENTS
1. ACCOUNTING POLICIES
The interim financial information has been prepared in accordance with IAS 34
'Interim Financial Reporting' and in compliance with IFRS standards and
interpretations in force as at January 1, 2012, as adopted by the EU. The IFRS
recognition and measurement principles as described in the annual financial
statements for 2011 have also been applied in the preparation of the interim
financial information, with the changes mentioned below.
The relative proportion of the estimated tax charge for the full financial year
has been charged against the result for the period.
Standards, interpretations and amendments adopted from the beginning of 2012:
The following new standards, interpretations and amendments have been adopted
when applicable: IFRS 7 (amendment) and IFRS 12 (amendment) and the annual
improvements. The amendments did not have any material impact on the
consolidated financial statements.
2. SEGMENT INFORMATION
Amer Sports has three business segments: Winter and Outdoor, Ball Sports and
Fitness.
The accounting policies for segment reporting do not differ from the Group's
accounting policies. The decisions concerning assessing the performance of
segments and allocation of resources to the segments are based on segments' net
sales and earnings before interest and taxes. The chief operating decision maker
of Amer Sports is the Executive Board.
There were no intersegment business operations during the reported periods.
Earnings Financing
before income Earnings
interest and and before
Net sales taxes expenses taxes Assets
---------------------------------------------------------------------
1-9/2012
Winter and Outdoor 818.4 72.1 1,027.1
Ball Sports 442.0 27.0 365.4
Fitness 185.1 9.1 246.5
---------------------------------------------------------------------
Segments, total 1,445.5 108.2 1,639.0
---------------------------------------------------------------------
Unallocated items*) -18.2 -20.4 290.4
---------------------------------------------------------------------
Group total 1,445.5 90.0 -20.4 69.6 1,929.4
---------------------------------------------------------------------
1-9/2011
Winter and Outdoor 762.6 73.5 983.5
Ball Sports 402.0 25.7 355.0
Fitness 159.3 5.8 231.5
-----------------------------------------------------
Segments, total 1,323.9 105.0 1,570.0
-----------------------------------------------------
Unallocated items*) -15.8 -14.4 216.5
-----------------------------------------------------
Group total 1,323.9 89.2 -14.4 74.8 1,786.5
-----------------------------------------------------
1-12/2011
Winter and Outdoor 1,137.6 118.5 960.0
Ball Sports 511.0 25.0 384.4
Fitness 232.2 10.3 253.8
-----------------------------------------------------
Segments, total 1,880.8 153.8 1,598.2
-----------------------------------------------------
Unallocated items*) -18.3 -20.5 219.8
-----------------------------------------------------
Group total 1,880.8 135.5 -20.5 115.0 1,818.0
-----------------------------------------------------
*) Earnings before interest and taxes include income and expenses of corporate
headquarters.
GEOGRAPHIC BREAKDOWN OF NET SALES
1-9/ 1-9/
2012 2011 2011
------------------------------------
EMEA 657.4 643.8 917.6
Americas 609.3 536.7 742.1
Asia Pacific 178.8 143.4 221.1
------------------------------------
Total 1,445.5 1,323.9 1,880.8
------------------------------------
3. DERIVATIVE FINANCIAL INSTRUMENTS
September September December
30, 2012 30, 2011 31, 2011
---------------------------------------------------------
Nominal value
Foreign exchange derivatives 953.9 721.7 922.6
Interest rate swaps 100.0 144.1 50.0
Cross currency swaps 59.2 54.0 56.1
Fair value
Foreign exchange derivatives 10.6 5.4 2.0
Interest rate swaps -4.3 -3.7 -3.1
Cross currency swaps 0.7 0.3 0.5
4. HYBRID BOND
On March 12, 2012 Amer Sports redeemed the EUR 60 million hybrid bond issued on
March 12, 2009.
5. DIVIDENDS
Dividends distributed in March 2012 by Amer Sports to its shareholders and
minority shareholders of its subsidiaries amounted to EUR 38.9 million relating
to the year ending on December 31, 2011 (2011: 36.4). Dividends distributed to
the shareholders of Amer Sports Corporation were EUR 0.33 per share and in total
EUR 38.9 million (2011: EUR 0.30 per share and in total EUR 36.3 million).
6. CONTINGENT LIABILITIES AND SECURED ASSETS
September September December
30, 2012 30, 2011 31, 2011
--------------------------------------------------------------------------
Guarantees 23.6 20.3 21.4
Liabilities for leasing and rental agreements 128.2 115.8 123.2
Other liabilities 30.8 28.3 33.8
There are no guarantees or contingencies given for the management of the
company, the shareholders or the associated companies.
7. ONGOING LITIGATIONS
The Group has extensive international operations and is involved in a number of
legal proceedings, including product liability suits. The Group does not expect
the outcome of any legal proceedings currently pending to have materially
adverse effect upon its consolidated results or financial position.
8. SEASONALITY
Although Amer Sports operates in a number of sporting goods segments during all
four seasons, its business is subject to seasonal fluctuations. Historically,
the third and fourth quarters of a financial year have been the strongest
quarters for Amer Sports in terms of both net sales and profitability, mainly
because sales of winter sports equipment ahead of the winter season typically
take place during the third and fourth quarters. The summer season for ball
sports balances seasonality to a certain extent, as the strongest quarters for
the Ball Sports segment are the first and second quarters. Usually the net cash
flow from operating activities is very strong in the first quarter when the
income from winter sports equipment realizes. Especially during the third
quarter, the net cash flow from operating activities is tied up in working
capital.
All forecasts and estimates presented in this report are based on the
management's current judgment of the economic environment. The actual results
may differ significantly.
AMER SPORTS CORPORATION
Board of Directors
Amer Sports Corporation Interim Report January-September 2012:
http://hugin.info/3020/R/1652293/533324.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Amer Sports Oyj via Thomson Reuters ONE
[HUG#1652293]
Unternehmensinformation / Kurzprofil:
Datum: 25.10.2012 - 12:02 Uhr
Sprache: Deutsch
News-ID 196330
Anzahl Zeichen: 61292
contact information:
Town:
Helsinki
Kategorie:
Business News
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"Amer Sports Corporation Interim Report January-September 2012"
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