Amer Sports reported fourth quarter sales were flat at $495.3 million ($653.2 mm) versus $497.1 million ($720.0 mm) a year ago. In local currencies, net sales decreased 3%. Earnings before interest and taxes (EBIT) before non-recurring charges were down 34% to $35.2 million ($46.4 mm) from $53.7 million ($77.8 mm) a year ago due to weakness in fitness and ball sports.


  


The year-ago period included $42.7 million ($61.9 mm) in restructuring costs that reduced EBIT to $11 million ($15.9 mm).


 


Net earnings were $17.7 million ($23.3 mm), or 25 cents ($0.33) a share, against $1.3 million ($1.9 mm), or 2 cents ($0.03) a year ago.


 


Full-year 2008 net sales decreased 5% to $1.58 billion ($2.32 bn) from $1.65 billion ($2.26 bn) a year ago. In local currencies net sales were at last year's level. Earnings before interest and taxes (EBIT) before charges were down 14% to $78.9 million ($116.1 mm) from $92.2 million ($126.4 mm), including a capital gain of $13.1 million ($18.0 mm) from selling the company's corporate headquarters building in April 2008. After the year-ago restructuring charge, the year-ago EBIT was $59 million ($80.9 mm).


 


Net earnings for the full year were $34 million ($50.0 mm), or $47 cents ($0.69) a share, against $18.5 million ($25.4 mm), or $25 cents ($0.34), a year ago.


 


“The last quarter of the year winter sports progressed due to product innovations and good snow conditions. Fitness market continued to be a challenge and Precor performed below expectations. Our Q4 EBIT of �35 million is also burdened by one-time product recall costs from Mavic and Atomic of some $6 million. Looking at the year as a whole, Group sales were at last year's level thanks to the continued success of our Apparel and Footwear business. Despite the several cost cutting measures we made during the year, these could not offset the drastic and rapid sales decline in our Fitness business.”


 


The absolute priority in 2009 will be on strengthening the balance sheet. We are ready to consider all necessary measures to achieve this. New programs have been started to significantly reduce working capital. These will bring results towards the end of the year. Furthermore, our capital expenditures will be lower than during the previous years. We are also continuing to cut expenses in most of our businesses in order to adjust our organization to the current market conditions. All in all, with our improving cash flow and other possible measures, I believe that our balance sheet will strengthen during the current year.


 


Also the sporting goods sector is affected by the financial crisis. Even if sell-out from stores has remained on a relatively healthy level, many of our retail clients have taken a cautious approach and are destocking their inventories. In some cases again, our clients have been postponing their ordering due to the tight credit conditions in the financial markets. All in all, in the environment we are in, our outlook is more uncertain than normally. Our current view is, however, that our earnings in 2009 will improve thanks to the improved cost efficiency, in Winter Sports Equipment in particular.”


 


NET SALES AND EBIT IN OCTOBER – DECEMBER


 


Net sales by business segment were as follows: Winter and Outdoor 66% (Winter Sports Equipment 41%), Ball Sports 22% and Fitness 12%. Net sales increased in Winter and Outdoor 7% and in Ball Sports 3% whereas net sales decreased 31% in Fitness. In local currency terms, net sales in Winter and Outdoor increased 6% but decreased 2% in Ball Sports and 36% in Fitness.


 


The geographical breakdown of net sales was as follows: EMEA (Europe, Middle East and Africa) 50%, the Americas (North, South and Central America) 36% and Asia Pacific (including Japan and Australia) 14%. Sales increased 7% in EMEA and 4% in Asia Pacific but decreased 10% in the Americas. In local currency terms, net sales increased 6% in EMEA and were at last year's level in Asia Pacific. In the Americas sales decreased 15%.


 


The Group's earnings before interest and taxes (EBIT) were $35.2 million ($46.4 mm) versus $53.7 million ($77.8 mm) a year ago. The results are burdened by one-time product recall costs of Mavic and Atomic of �6 million. Last year's results include $42.7 million ($61.9 mm) restructuring costs. Excluding both of these items the results weakened by 23% due to weaker profitability in both Fitness and Ball Sports.


 



NET SALES AND EBIT IN THE REVIEW PERIOD, JANUARY-DECEMBER


 


Net sales by business segment were as follows: Winter and Outdoor 55% (Winter Sports Equipment 25%), Ball Sports 31% and Fitness 14%. Winter and Outdoor sales increased 4%, Ball Sports sales decreased 7%, and Fitness decreased 24%. In local currency terms, Winter and Outdoor net sales increased 5%, Ball Sports were at last year's level and Fitness decreased 20%.


 


The split of net sales by geographical segment was as follows: EMEA 46%, the Americas 43% and Asia Pacific 11%. Sales in EMEA increased 3% and in Asia Pacific 2% but declined 12% in the Americas. In local currency terms, net sales increased 4% in EMEA, were at last year's level in Asia Pacific, and decreased 7% in the Americas.