Amer Sports reported a slight decline in earnings in the fourth quarter. Sales grew 10 percent overall on a currency-neutral basis and 5 percent on an organic basis. Growth was strongest in Apparel, up 41 percent and D2C, ahead 23 percent. Regionally, revenues increased 16 percent in China and 10 percent in the U.S.
The company’s brands include Salomon, Arc’teryx, Peak Performance, Atomic, Mavic, Suunto, Wilson and Precor.
OCTOBER-DECEMBER 2018 (continuing operations)*
- Net sales €874.2 million (October-December 2017: 786.0). In local currencies, net sales +10 percent. Organic growth was 5 percent.
- EBIT excluding items affecting comparability (IAC) €96.7 million (98.1). Items affecting comparability €-12.9 million (-5.4).
- Earnings per share excl. IAC €0.53 (0.57). Earnings per share 0.44 (0.44).
- Free cash flow €187.7 million (156.2).
JANUARY-DECEMBER 2018 (continuing operations)*
- Net sales €2,678.2 million (2017: 2,574.6). In local currencies, net sales +7 percent. Organic growth was 4 percent.
- EBIT excl. IAC €231.2 million (214.4), 8.6 percent of net sales (8.3). Items affecting comparability €-22.3 million (-44.9).
- Earnings per share excl. IAC €1.23 (1.18). Earnings per share €1.08 (0.80).
- Free cash flow €34.9 million (161.3).
- Net debt/EBITDA excl. IAC 2.5 (December 31, 2017: 1.6).
- Due to the terms and conditions of the ongoing tender offer for all the shares in Amer Sports Corporation, the Board of Directors proposes that at this time no dividend shall be distributed to shareholders.
Outlook For 2019
In 2019, Amer Sports’ net sales in local currencies as well as EBIT excl. IAC are expected to increase from 2018. The company will prioritize sustainable, profitable growth, focusing on its strategic priorities in Apparel and Footwear, Direct to Consumer, China, and USA, whilst continuing its consumer-led transformation.
Heikki Takala, president and CEO, commentary:
“We closed the year 2018 with a solid Q4. Topline was up 10 percent (organic +5 percent), driven by our strategic acceleration priorities and on-going transformation. Growth was strongest in Apparel (+41 percent), boosted by the acquisition of Peak Performance. D2C (+23 percent) and e-tail (+15 percent) were again the winning channels, and China (+16 percent) and USA (+10 percent) drove geographical growth. Fitness (+9 percent) had strong topline momentum but profitability requires further work. In Q4, we continued to prepare strategically for a more focused portfolio as we proceeded the Cycling sale process, and in the core business we continued to invest into future growth to ensure a strong pipeline of initiatives for 2019 and beyond.
“In 2018, we delivered again record sales and profits as we closed the ninth consecutive year of profitable growth and broad-based improvement. We continued to drive our strategic transformation. Apparel became our largest business area, and Softgoods now represents 40 percent of our sales. Modern channels (own D2C and e-tail) reached 30 percent of our sales, and China and USA now represent 45 percent of the company sales. In short, our strategies are delivering results with the vast majority of our businesses making good progress. I want to thank our organization for the strong contribution in 2018, looking forward to another good year of growth and improvement in 2019.”
Amer’s full statement is available HERE.
Image courtesy Arc’teryx