Amer Sports Corporation Interim Report January-September 2009 (IFRS)
(Thomson Reuters ONE) - STOCK EXCHANGE RELEASEOctober 29, 2009 at 1:00 pm* Amer Sports net sales, at EUR 1,050.6 million (1,081.3), decreased by 3%. In local currencies, net sales decreased by 7%. Net sales decreased by 14% in the Americas, were at last year's level in the EMEA region and decreased by 2% for Asia Pacific in local currency terms.* EBIT was EUR 4.4 million (43.7). Earnings per share came to EUR -0.11 (0.22). The weakened results reflect mainly the weaker profitability of Amer Sports in North America. Furthermore, last year's result includes a capital gain of EUR 13.1 million from sale of the company's corporate headquarters building.* In the recently completed rights offering, Amer Sports raised gross proceeds of approximately EUR 160 million. A stronger balance sheet provides Amer Sports with financial, operational, and strategic flexibility that enables Amer Sports to execute its strategy.* The market outlook for Amer Sports has not changed during the third quarter. The company's guidance is unchanged: the Amer Sports full-year-2009 EBIT will be below last year's level. The expected improvement for Winter Sports Equipment due to previously implemented cost-efficiency measures is more than offset by weakness in other Amer Sports businesses. 7-9/ 7-9/ Change 1-9/ 1-9/ ChangeEUR million 2009 2008 % %*) 2009 2008 % %*) 2008Net sales 410.6 433.2 -5 -6 1,050.6 1,081.3 -3 -7 1,576.6Gross profit 171.3 186.2 -8 -9 423.5 448.7 -6 -9 633.0EBIT 40.7 51.5 -21 -21 4.4 43.7 78.9Financingincome andexpenses -2.3 -7.7 -11.3 -22.0 -33.3Earnings before 38.4 -12taxes 43.8 -6.9 21.7 45.6Net result 28.8 32.9 -12 -5.2 16.3 34.0Earnings pershare,EUR 0.38 0.45 -16 -0.11 0.22 0.47*) Change in local currency terms.ROGER TALERMO, PRESIDENT AND CEO:"The overall sales trend during the third quarter followed the oneseen during the first half of the year. The US market continues to bemore challenging than the European market, and consumers have beenmoving to value price points. Due to a warm fall in Central Europe,the trade requested later deliveries of pre-ordered winter sportsequipment, which partly explains the decline in sales for Amer Sportsof 6% in the third quarter."As we stated earlier, our key priority in 2009 is to strengthen theAmer Sports balance sheet. Our programs aimed at reducing inventoriesand receivables are currently ahead of the plan. With the recentlycompleted rights offering, Amer Sports is well equipped to continueto implement its strategy, even if the macroeconomic recession isprolonged."We do not anticipate a quick recovery of the sporting goods market,even if trading conditions would start to improve next year. Hence,we will continue to focus on strict cost control and we are planningto take our cost base further down in order to protect the AmerSports bottom line. We are also considering alternatives to shift thefocus of the business portfolio more towards categories where webelieve the best long-term opportunities exist and where the bestgroup-wide synergies can be achieved."NET SALES AND EBIT IN JULY-SEPTEMBERNet sales for Amer Sports, at EUR 410.6 million (433.2), showed a 5%decrease. In local currencies, net sales decreased by 6%.Net sales by business segment were as follows: Winter and Outdoor64%, Ball Sports 25%, and Fitness 11%. Sales for Winter and Outdoordecreased by 2%, for Ball Sports by 7%, and for Fitness by 19%. Inlocal currency terms, Winter and Outdoor's net sales decreased by 2%,with Ball Sports sales decreasing by 9% and Fitness sales decreasingby 20%.The distribution of net sales by geographical region was as follows:the Americas 40%, EMEA 50%, and Asia Pacific 10%. Sales in theAmericas decreased by 12% and were at last year's level for EMEA. ForAsia Pacific, net sales increased by 5%. In local currency terms, netsales decreased by 14% in the Americas and were at last year's levelfor both EMEA and Asia Pacific.The Group's EBIT was EUR 40.7 million (51.5). The weakened resultsreflect mainly the weaker profitability of the North Americanoperations of Amer Sports.Earnings before taxes were EUR 38.4 million (43.8), and earnings pershare came to EUR 0.38 (0.45). Net financial expenses amounted to EUR2.3 million (7.7), which included EUR 3.3 million in unrealizedforeign exchange gains.NET SALES AND EBIT IN THE REVIEW PERIOD, JANUARY-SEPTEMBERAmer Sports net sales, EUR 1,050.6 million (1,081.3), saw a decreaseof 3%. In local currency terms, net sales decreased by 7%.Net sales by business segment were as follows: Winter and Outdoor51%, Ball Sports 36%, and Fitness 13%. Sales were at last year'slevel for Winter and Outdoor and Ball Sports. Net sales of Fitnessdecreased by 16%. In local currency terms, Winter and Outdoor's netsales were at last year's level, those of Ball Sports decreased by7%, and Fitness' net sales decreased by 23%.By geographical region, net sales were as follows: the Americas 44%,EMEA 45% and Asia Pacific 11%. Sales decreased in the Americas by 7%and were at last year's level for EMEA. For Asia Pacific, net salesincreased by 6%. In local currency terms, net sales decreased by 14%in the Americas and by 2% for Asia Pacific but were at last year'slevel for EMEA.The Group's EBIT was EUR 4.4 million (43.7). The weakened resultsreflect mainly the weaker profitability of Amer Sports North Americanoperations. Furthermore, last year's result includes a capital gainof EUR 13.1 million from sale of the company's corporate headquartersbuilding.Earnings before taxes came to EUR -6.9 million (21.7). Earnings pershare were EUR -0.11 (0.22). Net financial expenses, which amountedto EUR 11.3 million (22.0), included EUR 7.9 million in unrealizedforeign exchange gains.CAPITAL EXPENDITUREThe Group's capital expenditure on fixed assets totaled EUR 21.5million (23.1). The Group's depreciation figure was EUR 25.4 million(25.7).RESEARCH AND DEVELOPMENTEUR 37.9 million (39.6) was invested in research and development,representing 3.6% of net sales.FINANCIAL POSITION AND CASH FLOWAmer Sports had interest-bearing liabilities at the end of Septemberof EUR 627.2 million (628.5), consisting of short-term debt of EUR158.1 million and long-term debt of EUR 469.1 million. Liquid assetsamounted to EUR 62.4 million (24.8) at the end of the period. TheGroup's net debt was EUR 564.8 million (603.7). Amer Sports totalunused committed credit facilities amounted to EUR 140.0 million.Amer Sports has a EUR 325 million committed revolving creditfacility, maturing in 2011 and 2012, of which EUR 295 million hasbeen used. Furthermore, the company has, as of January 2009,committed revolving credit facilities of EUR 60 million maturing in2010 and a EUR 50 million committed revolving credit facility, agreedin August, to mature when Amer Sports has received the proceeds fromthe rights offering but no later than on November 15, 2009.Amer Sports long-term debt consists of a EUR 75 million privateplacement bond maturing in 2011, a USD 100 million term loan anddraw-downs totaling EUR 295 million as part of the originally EUR 575million loan syndicate of 2005 (maturing in 2011 and 2012), and a EUR28.6 million pension loan.Short-term financing is mainly raised with a domestic commercialpaper program, of which EUR 148.8 million had been used at the end ofSeptember.In March, Amer Sports Corporation issued a EUR 60 million hybrid bondin order to strengthen the Group's capital structure and to repayexisting debt. The coupon rate of the bond is 12.0% per annum. Thebond has no maturity, but the company may call the bond after threeyears. The hybrid bond is unsecured and subordinated to all seniordebt and is treated as equity in the Amer Sports consolidatedfinancial statements. The hybrid bond does not confer shareholders'rights, nor does it dilute the holdings of shareholders.The equity ratio at the end of September was 35.9 (30.9) and gearingwas 104% (124).Net cash flow from operating activities after interest and taxes wasEUR 33.3 million (9.9). Net cash flow from investing activities wasEUR -22.0 million (6.5).A EUR 160 million rights offeringAs part of Amer Sports' measures to improve its balance sheet, itundertook a rights offering that was completed on October 23, 2009.Amer Sports raised gross proceeds of approximately EUR 160 million inthe rights offering. The proceeds from the rights offering will beused to strengthen the financial position of Amer Sports and toimprove the company's operational and strategic flexibility. As ofSeptember 30, 2009 Amer Sports had a net gearing of 104%. The rightsoffering will strengthen the balance sheet such that the gearingwould have been 60% on a pro forma basis on September 30, 2009.The Extraordinary General Meeting of shareholders of Amer Sports heldon September 23, 2009 authorized the Board of Directors to undertakea share issue. On September 24, 2009 Amer Sports announced the termsand conditions of its rights offering, and on September 28, 2009 itpublished an offering circular relating to the offering of 48,471,734new shares.The final outcome of the Amer Sports rights offering shows that48,070,466 shares, representing 99.2% of the total number of sharesoffered, were subscribed for with subscription rights. The remaining401,268 shares, or 0.8% of the total number of shares offered, weresubscribed for without subscription rights, have been allocatedaccording to the principles described in the prospectus published onSeptember 28, 2009. The rights offering was oversubscribed with atotal subscription level of 149.1%. Trading in the new sharesalongside the existing shares started on October 27, 2009.As a result of the rights offering, the number of Amer Sports' sharesincreased by 48,471,734 to 121,517,285 shares. The total net proceedsof the rights offering amounted to approximately EUR 152 million.BUSINESS SEGMENTSWINTER AND OUTDOOR 7-9/ 7-9/ Change 1-9/ 1-9/ ChangeEUR million 2009 2008 % %*) 2009 2008 % %*) 2008Net sales Winter Sports 119.6 128.7 -7 -8 168.0 182.2 -9 378.9Equipment -8 Apparel and 99.3 93.5 6 7 230.9 204.0 14 277.9Footwear 13 Cycling 21.5 23.5 -9 -10 73.3 82.9 -12 -14 114.2 Sports Instruments 22.0 21.9 0 -1 61.2 65.1 -6 -8 89.8Net sales, total 262.4 267.6 -2 -2 533.4 534.2 0 -1 860.8EBIT 44.1 45.7 -4 -4 4.0 4.4 -9 -7 41.1*) In local currency terms.In January-September, Winter and Outdoor's net sales of EUR 533.4million were at last year's level in local currency terms. Thebreakdown of net sales by business area was as follows: Winter SportsEquipment 32%, Apparel and Footwear 43%, Cycling 14%, and SportsInstruments 11%. EMEA accounted for 66%, the Americas for 24%, andAsia Pacific for 10% of net sales. Sales in local currencies weredown 12% in the Americas and 5% for Asia Pacific, but were up 5% forEMEA.The EBIT of EUR 4.0 million (4.4) fell by 7% in local currency terms.Business areasIn the review period, Winter Sports Equipment's net sales decreasedby 9% in local currencies. Third-quarter sales decreased by 8%, dueto later timing of deliveries. The order book for the 2009/10 seasonis on last year's level with strong growth in cross-country skiingand protective items. The order level in North America issignificantly below last year's level, whereas it is up in CentralEurope and in Scandinavia. Profitability in the Winter SportsEquipment business is clearly improving in 2009 because of previouslyimplemented cost efficiency measures.In local currencies, Apparel and Footwear's net sales grew by 14% inthe review period, with this growth being driven particularly bySalomon. The US market has remained depressed, while demand in Europehas remained encouraging with good reorders of Salomon footwear.Overall delivery performance is very positive, and inventorymanagement continues to improve according to targets. This allows theproducts to be in the stores early, which aids in selling out andincreases the likelihood of reorders.Bicycle component manufacturer Mavic's net sales declined by 14% inlocal currencies, reflecting the impact of the R-Sys recall, a weakUS economy, a general trend towards lower inventory at independentbike dealer level (IBD), and a significant decline in OEM sales. Inthe third quarter, Mavic's sales fell in local currencies by 10%.Mavic apparel and footwear product lines have been well received inthe market. On September 1, Amer Sports announced that it iscurrently exploring strategic alternatives regarding its cyclingbusiness, Mavic. Among other alternatives, the strategic review mayresult in a divestiture of this asset.In the review period, the net sales of Sports Instruments were 8%below last year's level in local currencies but were flat in thethird quarter. Net sales declined in diving instruments and in theUS, but the demand for diving instruments have recently shown somepositive signs. During the third quarter, shipments of the newpremium watch line, Elementum started. Suunto's cost savings programis proceeding as planned.BALL SPORTS 7-9/ 7-9/ Change 1-9/ 1-9/ ChangeEUR million 2009 2008 % %*) 2009 2008 % %*) 2008Net sales Racquet Sports 52.8 56.7 -7 -9 181.8 181.9 0 -5 227.0 Team Sports 35.8 38.0 -6 -10 143.7 137.1 5 -5 189.9 Golf 14.8 15.9 -7 -8 56.5 66.5 -15 -17 78.6Net sales, total 103.4 110.6 -7 -9 382.0 385.5 -1 -7 495.5EBIT 2.4 6.6 -64 -64 21.3 33.6 -37 -41 37.0*) In local currency terms.In January-September, Ball Sports had net sales of EUR 328.0 million,showing a decline by 7% in local currencies. The breakdown of netsales by business area was as follows: Racquet Sports 47%, TeamSports 38%, and Golf 15%. Of the net sales, the Americas generated62%, EMEA 25%, and Asia Pacific 13%. In local currency terms, theAmericas declined by 11% and EMEA by 4%, while Asia Pacific grew by8%.The EBIT figure, EUR 21.3 million (33.6), was weakened by 41% inlocal currency terms and was driven by volume declines and lowergross margins. The gross margins have been negatively affected byaggressive actions to reduce inventories and the trend of consumersgravitating to value price points as a result of the recession.Business areasIn local currencies, Racquet Sports' net sales declined by 5%. Inlocal currencies, the Americas saw a decline in business of 13%, EMEAa decline of 3%, and Asia Pacific growth by 10%. The decline in theAmericas was driven by the United States, where net sales wereadversely influenced by the economic recession. Wilson remained thenumber-one brand in tennis, highlighted by being the choice of themost tour players in the US. The growth in Asia continued to bedriven by the expanded distribution in China. In local currencies,the badminton category grew by 31% for the period under review.In local currencies, Team Sports' net sales declined by 5%. TheAmericas saw a decline of 6% and EMEA one of 17%, while Asia Pacificgrew by 34% in local currencies. About 84% of the Team Sportsbusiness is generated in the United States driving the overalltrends. In the challenging economic environment, DeMarini batscontinued to gain market share in all segments of the business bykeeping sales flat at the previous year's levels. The Soccer businessgrew by 14%, driven by Latin American market expansion and the newNCAA Match Ball adoption. The market for American footballs, wheremarket shares are strong, experienced softness with an 11% decline.In local currencies, Golf' net sales declined by 17%. However, Golf'ssales trend improved in the third quarter. The net sales declines byregion are 26% in the Americas, 5% for the EMEA region and 20% forAsia Pacific in local currencies.FITNESS 7-9/ 7-9/ Change 1-9/ 1-9/ ChangeEUR million 2009 2008 % %*) 2009 2008 % %*) 2008Net sales 44.8 55.0 -19 -20 135.2 161.6 -16 -23 220.3EBIT -1.4 2.8 -7.0 6.1 3.8*) In local currency terms.In January-September, Fitness' net sales declined by 23% in localcurrencies to EUR 135.2 million. The Americas accounted for 73%, EMEAfor 19%, and Asia Pacific for 8% of net sales. In local currencyterms, sales were down 23% in the Americas, 19% for EMEA, and 25% forAsia Pacific.EBIT decreased to EUR -7.0 million (6.1) due to the significant fallin sales and lower gross margins, resulting from a lower capacityutilization rate and pricing pressure. Precor will continue to focuson cost savings to return to profitability.The market situation is unchanged from that of the first half of2009, with the general economic climate being the largest driver ofPrecor's performance. In local currencies, net sales for the thirdquarter decreased by 20%.Demand for commercial equipment for both North America and EMEA hasbeen affected as customers defer purchase decisions in light of thefinancial uncertainty. The specialty fitness stores are generating aslittle as half the business they did during the peak of 2007.Availability of credit and of financing (i.e. leasing) are alsohaving an impact, particularly in Europe. A few perceptive commercialcustomers are taking advantage of the situation to upgrade theirfacilities and move ahead of their competition.Consumer products sales have been greatly affected by significantlower consumer spending due to the uncertain economic environment andsignificant reduction among specialty dealers in comparison to theprevious year. Consumer sales' pick-up in the late fall and thecoming season will be an important measure of the health of themarket.Two bright spots in the Precor portfolio are the AMT and selectorizedstrength. The AMT continues to enjoy increased market penetration asmany customers increase the number of units installed per clublocation, and selectorized strength is growing in comparison to theprevious year, thanks to the introduction of two new lines.Construction of the new strength equipment production facility inNorth Carolina is on track for December occupancy. This facility willboth provide needed capacity for the recently launched selectorizedstrength lines and reduce manufacturing costs.PERSONNELAt the end of September, the Group employed 6,455 people (6,138). TheGroup employed an average of 6,345 people (6,264) during the reviewperiod. This increase is mainly due to the acquisition of theBulgarian production facility in 2008 (486 employees).+------------------------------------------------------------------+| | September 30, 2009 | September 30, | Change || | | 2008 | % ||--------------------+--------------------+---------------+--------|| Winter and Outdoor | 4,067 | 3,570 | 14 ||--------------------+--------------------+---------------+--------|| Ball Sports | 1,618 | 1,714 | -6 ||--------------------+--------------------+---------------+--------|| Fitness | 699 | 790 | -12 ||--------------------+--------------------+---------------+--------|| Headquarters | 71 | 64 | 11 ||--------------------+--------------------+---------------+--------|| Total | 6,455 | 6,138 | 5 |+------------------------------------------------------------------++------------------------------------------------------------+| | September 30, 2009 | September 30, | Change || | | 2008 | % ||--------------+--------------------+---------------+--------|| EMEA | 3,717 | 3,234 | 15 ||--------------+--------------------+---------------+--------|| Americas | 2,187 | 2,346 | -7 ||--------------+--------------------+---------------+--------|| Asia Pacific | 551 | 558 | -1 ||--------------+--------------------+---------------+--------|| Total | 6,455 | 6,138 | 5 |+------------------------------------------------------------+NEW MANAGEMENT MODELAmer Sports Corporation reorganized its management model by creatingone group-wide Amer Sports management team. The purpose of the newExecutive Board is to strengthen the development and consistentexecution of Amer Sports corporate strategy across all business areasand regions, driving Group integration, common goals, and the Group'soverall performance.Amer Sports Executive Board members are presented in more detail atwww.amersports.com/about.SHARES AND SHAREHOLDERSAt the end of September Amer Sports had 13,808 registeredshareholders (12,243). Nominee registrations represented 49.7%(44.1%) of the shares.In the course of the period, in total, 55.3 million Amer Sportsshares were traded on the NASDAQ OMX Helsinki exchange, to a totalvalue of EUR 365.3 million. The share turnover was 76.0% (of theaverage number of shares, excluding own shares).At the close of the review period, the last trading in Amer SportsCorporation shares was at EUR 5.92. The high for the period on theNASDAQ OMX Helsinki exchange was EUR 9.00, and the low EUR 4.69. Theaverage share price was EUR 6.61.The company's paid-in share capital recorded in the Trade Register asof September 30, 2009 was EUR 292,182,204, and the number of sharesoutstanding was 73,045,551. As a result of the rights offering, thenumber of Amer Sports' shares increased on October 26, 2009 by48,471,734 shares to 121,517,285 shares. Amer Sports has 337,950 ownshares, which are owned by Amer Sports International Oy. The numberof own shares corresponds to 0.5% of all Amer Sports shares.On September 30, 2009, the company had a market capitalization of EUR430.4 million, excluding own shares.Major changes in holdings, January-September 2009Amer Sports Corporation received information on February 19, 2009 tothe effect that Novator Finland Oy had converted all of its NASDAQOMX forward contracts into direct holdings in shares of Amer SportsCorporation on February 18, 2009. On July 2, 2009, Amer SportsCorporation was notified that Novator Finland Oy had sold its entireholding of shares in the company.The stock exchange announcements on major changes in shareholdingscan be found on the Amer Sports Web pages atwww.amersports.com/investors.RESOLUTIONS OF THE GENERAL MEETINGS OF SHAREHOLDERSAmer Sports' Annual General Meeting of shareholder held on March 5,2009, authorized the Board of Directors to decide on issuing newshares on the following terms and conditions: New shares may beissued and the company's own shares held by the company may beconveyed against payment ("Share Issue Against Payment") to thecompany's shareholders in proportion to their current shareholdingsin the company. By virtue of the authorization, the Board ofDirectors is entitled to decide on issuing a maximum of 7,000,000 newshares. The subscription price of the new shares shall be booked tothe invested non-restricted equity fund. The authorization to issueshares is valid until two years from the date of the decision of theAnnual General Meeting.On April 17, 2009, the Board of Directors of Amer Sports Corporationdecided to cancel the Extraordinary General Meeting summoned to beheld on April 28, 2009, after receiving notice of Novator FinlandOy's cancellation of its demand for an Extraordinary General Meeting.The Extraordinary General Meeting of shareholders of Amer Sports heldon September 23, 2009 authorized the Board of Directors to undertakea share issue for consideration in which the shareholders wereentitled to subscribe for new shares in proportion to their priorshareholding. The Board of Directors was authorized to decide uponoffering any shares that may remain unsubscribed for pursuant to theshareholders' pre-emptive rights to parties determined by the Boardof Directors. By virtue of the authorization, the Board of Directorswas entitled to decide on issuing a maximum of 150,000,000 new sharesin the share issue. The Board of Directors was authorized todetermine the other terms and conditions of the share issue. Theauthorization of the Board of Directors to undertake the share issuedid not supersede or otherwise invalidate the share issueauthorization granted to the Board of Directors by the Annual GeneralMeeting on March 5, 2009.The documentation and press releases related to the meetings areavailable on the company's Web site, at www.amersports.com.BUSINESS RISKS AND UNCERTAINTY FACTORSAmer Sports Corporation's short-term risks are particularlyassociated with consumer demand in North America and Europe. Furtherinformation on the company's business risks and uncertainty factorsis available on the company's Web site, atwww.amersports.com/investors.EVENTS AFTER THE REVIEW PERIODOn October 2, 2009, Mr. Antti Jääskeläinen (Finnish citizen born in1972) was named Amer Sports Chief Development Officer. The newlycreated position was established to strengthen the Amer Sportsmanagement in strategic planning and execution. Mr. Jääskeläinen willjoin Amer Sports on December 1, 2009. He will report to Amer Sports'President and CEO Roger Talermo and will be a member of the ExecutiveBoard.The company announced on October 23, 2009 that the final outcome ofAmer Sports rights offering shows that 48,070,466 million shares,representing 99.2% of the total number of shares offered, weresubscribed for with subscription rights. The remaining 401,268 shareswere subscribed for without subscription rights. As a result of therights offering, the number of Amer Sports' shares increased by48,471,734 shares to 121,517,285 shares. The total net proceeds ofthe rights offering amounted to approximately EUR 152 million.Amendments to the terms and conditions of the warrant programsPursuant to the terms and conditions of Amer Sports' warrantprograms, the Board of Directors of Amer Sports must amend the termsand conditions of the warrant programs to take into account theimpact of the rights offering by adjusting the exercise price of thewarrants and/or the number of shares that can be subscribed forthrough exercise of the warrants in a manner to be determined by theBoard of Directors. On October 29, 2009, Amer Sports' Board ofDirectors decided on such amendments. The terms and conditions of itspublicly traded 2004 warrants were amended to the effect that each2004 warrant entitles its holder to subscribe for 5 shares at thesubscription price of EUR 9.44 per share.OUTLOOK FOR 2009The market outlook for Amer Sports has not changed during the thirdquarter. The company's guidance is unchanged: the Amer Sportsfull-year-2009 EBIT will be below last year's level. The expectedimprovement for Winter Sports Equipment due to previously implementedcost-efficiency measures is more than offset by weakness in otherAmer Sports businesses.TABLESThe notes are an integral part of consolidated interim financialinformation.UnauditedEUR millionCONSOLIDATED RESULTS 1-9/ 1-9/ Change 7-9/ 7-9/ Change 2009 2008 % 2009 2008 % 2008NET SALES 1,050.6 1,081.3 -3 410.6 433.2 -5 1,576.6Cost of goodssold -627.1 -632.6 -239.3 -247.0 -943.6GROSS PROFIT 423.5 448.7 -6 171.3 186.2 -8 633.0License income 6.6 10.2 2.0 3.3 14.3Other operatingincome 4.9 15.7 1.0 0.4 18.9R&D expenses -37.9 -39.6 -11.5 -11.4 -55.6Selling andmarketingexpenses -287.4 -293.6 -90.2 -95.0 -406.2Administrativeand otherexpenses -105.3 -97.7 -31.9 -32.0 -125.5EARNINGS BEFOREINTEREST ANDTAXES 4.4 43.7 40.7 51.5 -21 78.9% of net sales 0.4 4.0 9.9 11.9 5.0Financing incomeand expenses -11.3 -22.0 -2.3 -7.7 -33.3EARNINGS BEFORETAXES -6.9 21.7 38.4 43.8 -12 45.6Taxes 1.7 -5.4 -9.6 -10.9 -11.6NET RESULT -5.2 16.3 28.8 32.9 -12 34.0Attributable to:Equity holders ofthe parentcompany -5.3 16.2 28.7 32.8 33.9Minorityinterests 0.1 0.1 0.1 0.1 0.1Earnings pershare, EUR -0.11 0.22 0.38 0.45 0.47Earnings pershare, diluted,EUR -0.11 0.22 0.38 0.45 0.47Adjusted averagenumber ofshares in issueless own shares,million 72.7 72.5 72.7 72.5 72.5Adjusted averagenumber ofshares in issueless own shares,diluted, million 72.7 72.5 72.7 72.5 72.5Equity per share,EUR 7.41 6.69 6.95ROCE, % *) 3.8 5.5 7.9ROE, % -1.3 4.3 6.7Average ratesused:EUR 1.00 = USD 1.36 1.52 1.47*) 12 months' rolling averageSTATEMENT OF COMPREHENSIVE INCOME 1-9/ 1-9/ 7-9/ 7-9/ 2009 2008 2009 2008 2008Net result -5.2 16.3 28.8 32.9 34.0Other comprehensive income Translation differences -6.3 -4.0 -5.8 12.6 4.3 Cash flow hedges -0.6 4.0 1.0 -1.1 -4.7 Income tax related to components of other comprehensive income 0.2 -1.0 -0.2 0.3 1.2Other comprehensive income,net of tax -6.8 -1.0 -5.1 11.8 0.8Total comprehensive income -12.0 15.3 23.7 44.7 34.8Total comprehensive income attributable to:Equity holders of the parentcompany -12.1 15.2 23.6 44.6 34.7Minority interests 0.1 0.1 0.1 0.1 0.1NET SALES BY BUSINESS SEGMENT 1-9/ 1-9/ Change 7-9/ 7-9/ Change 2009 2008 % 2009 2008 % 2008Winter and Outdoor 533.4 534.2 0 262.4 267.6 -2 860.8Ball Sports 382.0 385.5 -1 103.4 110.6 -7 495.5Fitness 135.2 161.6 -16 44.8 55.0 -19 220.3Total 1,050.6 1,081.3 -3 410.6 433.2 -5 1,576.6EBIT BY BUSINESS SEGMENT 1-9/ 1-9/ Change 7-9/ 7-9/ Change 2009 2008 % 2009 2008 % 2008Winter and Outdoor 4.0 4.4 -9 44.1 45.7 -4 41.1Ball Sports 21.3 33.6 -37 2.4 6.6 -64 37.0Fitness -7.0 6.1 -1.4 2.8 3.8Headquarters -13.9 -0.4 -4.4 -3.6 -3.0Total 4.4 43.7 40.7 51.5 -21 78.9GEOGRAPHIC BREAKDOWN OF NET SALES 1-9/ 1-9/ Change 7-9/ 7-9/ Change 2009 2008 % 2009 2008 % 2008Americas 465.9 499.0 -7 163.6 185.7 -12 677.8EMEA 468.9 473.5 -1 204.0 206.6 -1 723.0Asia Pacific 115.8 108.8 6 43.0 40.9 5 175.8Total 1,050.6 1,081.3 -3 410.6 433.2 -5 1,576.6CONSOLIDATED CASH FLOW STATEMENT Note 1-9/2009 1-9/2008 2008EBIT 4.4 43.7 78.9Adjustments to cash flow from operatingactivities and depreciation 25.4 12.4 20.6Change in working capital 39.5 -15.9 -42.6Cash flow from operating activitiesbeforefinancing items and taxes 69.3 40.2 56.9Interest paid and received -20.2 -19.7 -31.9Income taxes paid -15.8 -10.6 -14.5Cash flow from operating activities 33.3 9.9 10.5Company acquisitions -1.2 - -2.5Company divestments - 3.6 3.6Capital expenditure on non-currenttangibleand intangible assets -21.5 -23.1 -43.1Proceeds from sale of tangiblenon-currentassets 0.7 26.0 27.4Cash flow from investing activities -22.0 6.5 -14.6Dividends paid 5 -11.8 -36.3 -36.4Hybrid bond 3 60.0 - -Change in net debt and other financial 3 42.8items -69.2 -23.5Cash flow from financing activities -21.0 -59.8 6.4Liquid funds on January 1 72.1 68.0 68.0Translation differences 0.0 0.2 1.8Change in liquid funds -9.7 -43.4 2.3Liquid funds on September 30/December 31 62.4 24.8 72.1CONSOLIDATED BALANCE SHEET September 30, September 30, December 31, Note 2009 2008 2008AssetsGoodwill 270.3 270.4 279.3Other intangible 205.5non-current assets 205.5 207.5Tangible non-current 128.6assets 125.2 135.3Other non-current 62.1assets 65.3 65.9Inventories and work in 311.1progress 378.4 346.0Receivables 469.3 514.0 555.8Cash and cash 62.4equivalents 24.8 72.1Assets 2 1,509.3 1,583.6 1,661.9Shareholders' equityand liabilitiesShareholders' equity 3 541.3 488.7 508.1Long-term 3interest-bearing 469.1liabilities 275.7 434.9Other long-term 13.1liabilities 17.3 22.0Current 3interest-bearing 158.1liabilities 352.8 252.8Other current 300.3liabilities 380.3 389.0Provisions 27.4 68.8 55.1Shareholders' equity 1,509.3and liabilities 1,583.6 1,661.9Equity ratio, % 35.9 30.9 30.6Gearing, % 104 124 121EUR 1.00 = USD 1.47 1.46 1.39CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY Fair Total Fund Trans- value share- Sh- Pre- for lation and Retai- Mino- hold- are mi- own diffe- other ned rity Hyb- ers' capi- um sha- ren- reser- ear- inte- rid equ- Note tal fund res ces ves nings Total rests bond ityBalance onJan. 1,2008 289.3 15.0 -7.5 -66.8 -2.7 278.9 506.2 3.5 - 509.7Totalcomp-rehensiveincome -4.0 3.0 16.2 15.2 0.1 15.3Dividenddistribution 5 -36.3 -36.3 -36.3Reissu-ance ofownshares 1.8 1.8 1.8Warrants -0.9 -0.9 -0.9Warrantsexercised 2.9 -2.9 0.0 0.0Otherchange inminorityinterests -0.9 -0.9Balance onSep. 30,2008 292.2 12.1 -5.7 -70.8 0.3 257.9 486.0 2.7 - 488.7Balance onJan. 1,2009 292.2 12.1 -5.7 -62.5 -6.2 275.6 505.5 2.6 - 508.1Totalcomp-rehensiveincome -6.3 -0.5 -5.3 -12.1 0.1 -12.0Dividenddistribution 5 -11.6 -11.6 -0.2 -11.8Hybridbond 3 -3.0 -3.0 60.0 57.0Balance onSep. 30,2009 292.2 12.1 -5.7 -68.8 -6.7 255.7 478.8 2.5 60.0 541.3QUARTERLY BREAKDOWN OF NET SALES AND EBIT Q3/ Q2/ Q1/ Q4/ Q3/ Q2/ Q1/ Q4/NET SALES 2009 2009 2009 2008 2008 2008 2008 2007Winter and Outdoor 262.4 106.6 164.4 326.6 267.6 104.6 162.0 304.9Ball Sports 103.4 135.7 142.9 110.0 110.6 130.9 144.0 107.0Fitness 44.8 42.4 48.0 58.7 55.0 49.6 57.0 85.2Total 410.6 284.7 355.3 495.3 433.2 285.1 363.0 497.1 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4EBIT 2009 2009 2009 2008 2008 2008 2008 2007Winter and Outdoor 44.1 -29.2 -10.9 36.7 45.7 -26.7 -14.6 35.2Ball Sports 2.4 7.4 11.5 3.4 6.6 11.3 15.7 8.0Fitness -1.4 -2.2 -3.4 -2.3 2.8 -0.4 3.7 13.0Headquarters -4.4 -5.4 -4.1 -2.6 -3.6 8.0 -4.8 -2.5Total 40.7 -29.4 -6.9 35.2 51.5 -7.8 0.0 53.7THE AMER SPORTS NOTES TO THE FINANCIAL STATEMENTS1. ACCOUNTING POLICIESThe interim financial information has been prepared in accordancewith IAS 34 'Interim Financial Reporting' and in compliance with IFRSstandards and interpretations in force as at January 1, 2009, asadopted by the EU. The IFRS recognition and measurement principles asdescribed in the annual financial statements for 2008 have also beenapplied in the preparation of the interim financial information, withthe changes mentioned below.The relative proportion of the estimated tax charge for the fullfinancial year has been charged against the result for the period.In key figures, the hybrid bond has been included in shareholders'equity. Interest expenses for the hybrid bond have been accrued onthe basis of its coupon rate of 12% and are debited directly toretained earnings net of tax. In the calculation of earnings pershare, interest expenses of the hybrid bond have been included in theearnings for the period.Standards and interpretations adopted from the beginning of 2009:IAS 1 (Revised), "Presentation of Financial Statements": The revisedstandard prohibits the presentation of income and expenses items(that is, "non-owner changes in equity") in the statement of changesin equity, requiring "non-owner changes in equity" to be presentedseparately from owner changes in equity. All non-owner changes inequity will be required to be shown in a performance statement, butentities can choose whether to present one performance statement (thestatement of comprehensive income) or two statements (the incomestatement and statement of comprehensive income). Where entitiesrestate or reclassify comparative information, they are required topresent a restated balance sheet as from the beginning of thecomparative period in addition to the current requirement to presentbalance sheets for the end of the current period and of thecomparative period. The company applies IAS 1 (Revised) from January1, 2009. Both the income statement and the statement of comprehensiveincome are presented as performance statements.IFRS 8, "Operating Segments": IFRS 8 replaces IAS 14, "SegmentReporting." The new standard requires a "management approach," underwhich segment information is presented on the same basis as that usedfor internal reporting purposes. IFRS 8 has not changed the company'ssegmentation, which is consistent with the company's internalreporting. Furthermore, IFRS 8 requires disclosures, e.g., about thecompany's geographical areas of operation and significant customers.Other changes in accounting policies:The committed revolving credit facilities used that mature in 2011and 2012 are reclassified as long-term interest-bearing liabilities.Comparative information for 2008 has been restated accordingly.2. SEGMENT INFORMATIONAmer Sports has three business segments: Winter and Outdoor, BallSports and Fitness.The accounting policies for segment reporting do not differ from theGroup's accounting policies and have not changed due to the adoptionof IFRS 8. The decisions concerning assessing the performance ofsegments and allocating resources to the segments are based onsegments' net sales and earnings before interest and taxes. The chiefoperating decision maker of Amer Sports is the Executive Board.The adoption of IFRS 8 has not changed the "reportable segments" forAmer Sports, since the segment information previously presented bythe Group was based on internal management reporting. Adoption of thestandard affected only the presentation of the information.There were no intersegment business operations during the reportedperiods. Earnings Financing before income Earnings interest and and before Net sales taxes expenses taxes Assets1-9/2009Winter and Outdoor 533.4 4.0 4.0 808.5Ball Sports 382.0 21.3 21.3 319.1Fitness 135.2 -7.0 -7.0 209.4Segments, total 1,050.6 18.3 18.3 1,337.0Unallocated items*) -13.9 -11.3 -25.2 172.3Group total 1,050.6 4.4 -11.3 -6.9 1,509.31-9/2008Winter and Outdoor 534.2 4.4 4.4 869.6Ball Sports 385.5 33.6 33.6 351.4Fitness 161.6 6.1 6.1 241.5Segments, total 1,081.3 44.1 44.1 1,462.5Unallocated items*) -0.4 -22.0 -22.4 121.1Group total 1,081.3 43.7 -22.0 21.7 1,583.62008Winter and Outdoor 860.8 41.1 41.1 875.4Ball Sports 495.5 37.0 37.0 381.1Fitness 220.3 3.8 3.8 245.3Segments, total 1,576.6 81.9 81.9 1,501.8Unallocated items*) -3.0 -33.3 -36.3 160.1Group total 1,576.6 78.9 -33.3 45.6 1,661.9*) Earnings before interest and taxes include income and expenses ofcorporate headquarters.GEOGRAPHIC BREAKDOWN OF NET SALES 1-9/ 1-9/ 2009 2008 2008Americas 465.9 499.0 677.8EMEA 468.9 473.5 723.0Asia Pacific 115.8 108.8 175.8Total 1,050.6 1,081.3 1,576.63. FINANCIAL LIABILITIESHybrid bondIn March, Amer Sports Corporation issued a EUR 60 million hybrid bondin order to strengthen the Group's capital structure and to repayexisting debt. The coupon rate of the bond is 12.0% per annum. Thebond has no maturity but the company may call the bond after threeyears. The hybrid bond is unsecured and subordinated to all seniordebt and is treated as equity in Amer Sports' consolidated financialstatements. The hybrid bond does not confer shareholders' rights, nordoes it dilute the holdings of shareholders.Reclassification of the credit facility:Committed revolving credit facilities used that mature in 2011 and2012 are presented under long-term interest-bearing liabilities.Comparative information for 2008 has been restated accordingly.Restatement had EUR 255 million in effects on short-term andlong-term liabilities at the end of 2008 and EUR 95 million forSeptember 30, 2008.4. DERIVATIVE FINANCIAL INSTRUMENTS September September December 30, 2009 30, 2008 31, 2008Nominal valueForeign exchange forward contracts 560.9 488.8 604.3Forward rate agreements 150.0 0.0 0.0Interest rate swaps 143.2 218.3 221.9Fair valueForeign exchange forward contracts 13.9 -1.3 -1.1Forward rate agreements -0.1 0.0 0.0Interest rate swaps -6.6 -1.0 -7.65. DIVIDENDSDividends distributed by Amer Sports to its shareholders and minorityshareholders of its subsidiaries amounted to EUR 11.8 million at theend of March 2009 relating to the year ending on December 31, 2008(EUR 0.16 / share for shareholders of Amer Sports Corporation,totaling EUR 11.6 million).6. CONTINGENT LIABILITIES AND SECURED ASSETS September September December 30, 2009 30, 2008 31, 2008Mortgages pledged 0.0 0.0 0.0Guarantees 9.3 5.0 8.5Liabilities for leasing and rentalagreements 106.1 111.2 106.6Other liabilities 38.7 44.5 46.1There are no guarantees or contingencies given for the management ofthe company, the shareholders or the associated companies.7. SEASONALITYThe business of Amer Sports is subject to seasonality; even thoughthe Group operates in many sports equipment segments during all fourseasons. Third and fourth quarters have historically been thestrongest for Amer Sports (measured by net sales and profitability),because winter sports equipment typically is sold before the winterseason, in the third and fourth quarter. Pre-orders of winter sportsequipment for 2009/2010 were at last year's level. During the thirdquarter, apparel and footwear sales grew, in local currencies, by 7%.The seasonality from Winter Sports Equipment is compensated partly bythe Ball Sports segment's summer season, because the strongest monthsfor Ball Sports are in the first and second quarter.All forecasts and estimates presented in this report are based on themanagement's current judgment of the economic environment. The actualresults may differ significantly.AMER SPORTS CORPORATIONBoard of DirectorsFor further information, please contact:Tommy Ilmoni, Vice President for IR and Corporate Communications,tel. +358 9 7257 8233Pekka Paalanne, Executive Vice President and CFO, tel. +358 9 72578212Roger Talermo, President and CEO, tel. +358 9 7257 8210TELEPHONE CONFERENCEAmer Sports Corporation will publish its third quarter results onThursday, October 29 at 1:00 pm Finnish time. An English-languagetelephone conference call for investors and analysts will be held onthe same day at 3:00 pm Finnish time. To participate in theconference call, please call +44 (0)20 3003 2666 (UK/internationaldial-in number). The conference can also be followed from a directtransmission on the Internet, at www.amersports.com.A recorded version will later be available at the same address, withreplay number +44 (0)20 8196 1998 and access code 6801881#.AMER SPORTS CORPORATIONCommunicationsMs Maarit MikkonenCommunications ManagerTel. +358 9 7257 8306, e-mail maarit.mikkonen(at)amersports.comwww.amersports.comDISTRIBUTIONNASDAQ OMX HelsinkiMajor mediawww.amersports.comhttp://hugin.info/3020/R/1351196/326447.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 29.10.2009 - 12:01 Uhr
Sprache: Deutsch
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