Amer Sports, Inc. · NYSE:AS
Amer Sports — Investor Day (December 2010)
17 slides from Amer Sports's investor day presentation, December 2010
Slide 1: Introducing new financial targets
Introducing new financial targets Pekka Paalanne Executive Vice President, CFO
Slide 2: Disclaimer
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 uncertain
Slide 3: Key figures in January−June 2010
Key figures in January−June 2010
Slide 4: Clear improvement in H1/2010 compared to H1/2009
Clear improvement in H1/2010 compared to H1/2009 EUR million Q2/10 Q2/09 Ch % Ch %* H1/10 H1/09 Ch % Ch %* 2009 Net sales 317.5 284.7 12 5 690.1 640.0 8 5 1,533.4 Gross profit 135.7 108.4 25 18 294.9 252.2 17 14 620.0 Gross profit, % of net sales 43 38 43 39 40 EBIT -16.9 -29.4 -7.4 -36.3 43.8 EBIT,
Slide 5: EBIT development H1/2010 YoY, EUR million
EBIT development H1/2010 YoY, EUR million 5 10 +23,3 -6,0 0 5 -5 -1,8 0 +1,2 -2,4 -7,4 -5 +12,5 -10 -10 -7,4 -15 -15 -20 +17,6 +13,4 -20 -25 -25 -30 -30 -35 -35 -36,3 -36,3 -40 -40 H1/09 Growth Margin/ OPEX Other H1/10 H1/09 W&O Ball Fitness HQ H1/10 Mix Sports
Slide 6: Seasonality: Quarterly net sales and EBIT 2008−Q2/2010
Seasonality Quarterly net sales and EBIT 2008−Q2/2010 EURm EURm (Sales) (EBIT) 500 100 400 80 300 60 200 40 100 20 0 0 -100 -20 -200 -40 Q1 Q2 Q3 Q4 Net Sales '08 Net Sales '09 Net Sales '10 EBIT '08 EBIT '09 EBIT '10 6
Slide 7: Seasonality: Quarterly cash flow after CAPEX 2008−Q2/2010
Seasonality Quarterly cash flow after CAPEX 2008−Q2/2010 (EURm) 130 114 94 55 -9 -11 -10 -20 -33 -89 Q1/08 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 7
Slide 8: Strong financial position
Strong financial position 1 100m June 30 Dec 31 EUR 1 000m Tax Assets 2010 2009 2009 59m Equity ratio, % 46 37 48 900m Gearing, % 34 103 38 W/C 800m 281m 700m Equity • A EUR 150 million bond was 746m 600m issued in June to domestic and Fixed Assets (incl. Hybrid 60m) international investors 500m 212
Slide 9: New financial targets to drive profitable growth
New financial targets to drive profitable growth
Slide 10: New financial targets to drive profitable growth
New financial targets to drive profitable growth Old Financial Targets • Organic growth of 5% over the cycle • At least 10% EBIT margin over the cycle • Active use of balance sheet whilst avoiding excessively large financial risks • Dividend of at least one-third of the annual net result Why updated
Slide 11: New long-term financial targets
New long-term financial targets Year end net debt / EBITDA Growth Delivering organic, currency-neutral ratio of 3 or less. annual growth of 5%. Capital Dividend and share price Profitability structure performance EBIT of at least 10% of net sales Annual free cash flow equal to net profit. Cash flow
Slide 12: Benefits of the new financial targets
Benefits of the new financial targets • Cash flow target is set to synchronize working capital management with targeted growth and profitability • The net debt/EBITDA ratio has been set to optimize balance sheet structure • Targets can be cascaded down to business areas and linked to our internal ma
Slide 13: New financial targets – status H1/2010
New financial targets – status H1/2010 Target June 30, 2010* Growth Delivering organic, currency-neutral 1% annual growth of 5% Profitability EBIT of at least 10% of net sales 4% Cash flow Annual free cash flow equal to net C/F > Net Profit profit (3.7X) Balance sheet Year-end Net Debt / EBITDA rati
Slide 14: Free cash flow equal to net profit
Free cash flow equal to net profit By setting free cash flow to be equal to net profit we can combine our Growth profitability and growth targets with tight 5% working capital control. When committed to 5% growth with 10% profitability, we are also focusing on continuously decreasing working capital
Slide 15: Requirements for working capital management
Requirements for working capital management 180d New financial target for cash flow DSI Development requires 6-7d annual improvement 160d in working capital items (DSI, DSO, 140d DPO). 120d Programs to improve supply chain 100d management: 80d 60d Program KPI 40d Complexity Reduction # SKU’s 20d S&O
Slide 16: Net debt / EBITDA 2005 – Q2/2010
Net debt / EBITDA 2005 – Q2/2010 8,0X Net debt/EBITDA shows how Amer Sports can generate 7,0X operational cash flow to service its debt. 6,0X It also shows required profitability 5,0X level against the outstanding debt 4,0X and makes it possible to link business specific targets to Group 3,0X balanc
Slide 17: Amer Sports
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