Amer Sports, Inc. · NYSE:AS
Amer Sports — H1 2006 Earnings Presentation
23 slides from Amer Sports's earnings presentation, Aug 9, 2006
Slide 1: Interim Report H1 2006
Interim Report H1 2006 August 9, 2006, Helsinki Roger Talermo President & CEO
Slide 2: US sporting goods and general retail sales
US sporting goods and general retail sales (nominal annual growth) Percent
Slide 3: General market conditions
General market conditions • Winter Sports – Last winter season was good, inventory levels are low – Sales of boots and bindings are growing faster than sales of skis – Fitness boom boosts sales in Nordic • Fitness – Consolidation in the fitness club market globally continued – Demand for entertainme
Slide 4: Net sales grew and EBIT improved
Net sales grew and EBIT improved Sports and leisure markets developed favorable in the first half of the year 1-6/ Pro forma 2006 1-6/2005 Ch % Net sales (MEUR) 739.2 689.9 7 EBIT (MEUR) -7.4 -14.2 48 EBT (MEUR) -18.7 -24.7 24 EPS (EUR) -0.19 -0.23 Pro forma is used for 2005 as primary comparison in
Slide 5: Highlights Q2/2006
Highlights Q2/2006 • Salomon’ social plan negotiations were completed – Cancellation of 370 work positions • Wilson’ strong development was influenced by profitability challenges in Golf • Hilton Hotels and Precor are launching Fitness by Precor facilities • Suunto had promising product launches • S
Slide 6: January – June 2006 results
January – June 2006 results Pekka Paalanne CFO
Slide 7: Seasonality of business operations: quarterly net sales
Seasonality of business operations: quarterly net sales 600 500 400 Suunto Atomic 300 Precor Wilson Salomon 200 100 0 Q1/05 Q2/05 Q3/05 Q4/05 Q1/06 Q2/06 Salomon changed substantially Amer Sports’ business structure and increased seasonality
Slide 8: Net sales development, last months
Net sales development, last 12 months 700 644,3 623,5 583,6 600 570,4 500 400 MEUR FY 2005 Last 12 months 300 270,8 252,1 214 209 200 100 73,6 72 0 Suunto Atom ic Precor Wils on Salom on
Slide 9: Profit and loss statement
Profit and loss statement MEUR Q2/06 Q2/05 Ch % H1/06 H1/05 Ch % 2005 Net sales 321.8 304.9 6 739.2 689.9 7 1,732.0 EBIT -9.0 -11.2 20 -7.4 -14,2 48 117.1 Net financials -6.4 -5.5 -16 -11.3 -10.5 -8 -24.0 EBT -15.4 -16.7 8 -18.7 -24.7 24 93.1 Taxes 4.6 5.7 -19 5.6 8.7 -36 -30.7 Net result -10.9 -11.
Slide 10: Net sales growth 1-6/2006
Net sales growth 1-6/2006 % of total sales Pro forma 1-6/06 FY 2005 2006 +12% 27% 36% Salomon 2005 W ilson +4% 46% 33% +16% 18% 15% Precor -15% 4% 12% Atomic +4% 5% 4% Suunto +7% 100% 100% Total 0 100 200 300 400 500 600 700 800 MEUR
Slide 11: Net sales growth 1-6/2006
Net sales growth 1-6/2006 % of total sales Pro forma 1-6/06 FY 2005 Americas 2006 +11% 54% 45% 2005 EMEA +3% 35% 44% +6% 11% 11% Asia Pacific Total +7% 100% 100% 0 200 400 600 800 MEUR
Slide 12: Breakdown of net sales
Breakdown of net sales MEUR Ch %, local Q2/06 Q2/05 Ch % H1/06 H1/05 Ch % 2005 currencies Salomon 76.4 71.7 7 199.7 178.9 12 10 623.5 Wilson 159.5 152.3 5 337.8 324.6 4 0 570.4 Precor 59.3 54.5 9 132.2 113.5 16 12 252.1 Atomic 5.6 7.8 -28 29.3 34.3 -15 -16 214.0 Suunto 21.0 18.6 13 40.2 38.6 4 0 72.
Slide 13: Breakdown of EBIT
Breakdown of EBIT MEUR Q2/06 Q2/05 Ch % H1/06 H1/05 Ch % 2005 Salomon -17.9 -23.3 23 -40.3 -47.8 16 18.1 Wilson 17.2 16.2 6 41.5 42.3 -2 52.1 Precor 4.1 4.6 -11 16.1 10.4 55 31.1 Atomic -12.2 -12.1 -1 -21.6 -20.5 -5 22.2 Suunto 3.7 1.5 147 4.8 3.2 50 3.4 HQ -3.9 1.9 -7,9 -1.8 -9.8 Total -9.0 -11.2 2
Slide 14: Cash flow statement
Cash flow statement MEUR 1-6/06 1-6/05 1-12/2005 Net cash from operating activities 135.4 37.0 96.4 Net cash from investing activities -48.0 3.6 -471.6 Net cash from financing activities Dividends paid -35.9 -35.9 -36.0 Issue of shares 0.2 0.0 0.7 Change in net debt -58.7 2.0 441.3 Net increase/decr
Slide 15: Balance sheet
Balance sheet MEUR 30 June 2006 30 June 2005 31 Dec 2005 Goodwill and other intangible non-current assets 509.4 310.9 528.8 Other non-current assets 181.4 109.6 172.1 Inventories 386.3 180.9 301.6 Receivables 353.6 204.2 635.1 Marketable securities - - - Cash 40.7 24.5 48.7 Equity 477.4 467.9 536.2
Slide 16: Equity ratio and gearing, %
Equity ratio and gearing, % 120 100 80 Eq ratio 60 Gearing 40 20 0 Q1/05 Q2/05 Q3/05 Q4/05 Q1/06 Q2/06 30 June 2006 30 June 2005 31 Dec 2005 Equity ratio, % 32.4 56.4 31.8 Gearing, % 106 28 112
Slide 17: Outlook
Outlook Roger Talermo President & CEO
Slide 18: Market and business outlook remains positive
Market and business outlook remains positive Winter Sports order-taking is at a good level • Salomon – Order books for almost all the key winter sports categories are higher than last year – The order book for the winter apparel both for Salomon and Arc’teryx brands is healthy • Atomic – Pre-orders
Slide 19: Market and business outlook remains positive
Market and business outlook remains positive • Precor’s growth continues to exceed the industry average – Demand for total product offering remains strong • Wilson – Racquet Sports’ positive development is continuing – Team Sports continues to be the fastest growing segment – Golf continues realignm
Slide 20: Strategic focus going forward
Strategic focus going forward • Salomon’s three-year turnaroud initiative launched last Dec. is progressing in line with targets • The implementation of synergies between Atomic and Salomon is proceeding accordance with plans • Common operational platforms are continued to be built – IT, sales, Asia
Slide 21: Full-year guidance defined
Full-year guidance defined • In 2006, Amer Sports’ net sales are expected to increase to EUR 1.8 billion (pro forma 2005: EUR 1,732 million). • Earnings per share in 2006 are expected to come in at EUR 0.95–1.05 (Q1/2006 guidance: EUR 0.90–1.05). • 2006 is a transitional year for Salomon. Substantia
Slide 22: Key figures
Key figures Pro forma Pro forma 1-6/2006 1-6/2005 Ch % 2005 Net sales (MEUR) 739.2 689.9 7 1,732.0 EBIT (MEUR) -7.4 -14.2 48 117.1 % of net sales -1 -2 7 EBT (MEUR) -18.7 -24.7 24 93.1 EPS (EUR) -0.19 -0.23 0.87 1-6/2006 1-6/2005 2005 ROCE, % *) 4.7 17.3 11.3 ROE, % -5.2 9.1 15.1 Net interest bearin
Slide 23: AMER SPORTS
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