Amer Sports Corp. reported fourth-quarter revenues rose 8 percent in local currencies with strong broad-based growth across the business areas. The gains in local currencies were led by its Fitness division, up 17 percent; followed by Ball Sports, 13 percent; and Winter and Outdoor, 5 percent.
Other highlights of the quarter:
- Gross margin dipped 50 basis ponits to 41.9 percent of revenues. The decline was due to inventory sell-out and production variances especially in Winter Sports Equipment.
- EBIT excluding non-recurring items was €46.5 million ($60.3 mm), compared with €46.3 a year earlier. Non-recurring items of €-24.8 million (0) were related to the earlier announced restructuring program.
- Excluding non-recurring items, earnings per share were €0.22 (€0.25). Earnings per share were €0.05 (0.25).
- Net cash flow after investing activities was €96.7 million (€49.0), mainly driven by decreased working capital.
Net sales by business segment
EUR million 10-12/ 10-12/ Change Change % of sales % of sales
2012 2011 % %*) 10-12/12 10-12/11
Winter and Outdoor 402.8 375.0 7 5 65 67
Ball Sports 127.7 109.0 17 13 21 20
Fitness 88.0 72.9 21 17 14 13
Total 618.5 556.9 11 8 100 100
*) In local currencies
Geographic breakdown of net sales
EUR million 10-12/ 10-12/ Change Change % of sales % of sales
2012 2011 % %*) 10-12/12 10-12/11
EMEA 305.3 273.8 12 10 50 49
Americas 224.8 205.4 9 5 36 37
Asia Pacific 88.4 77.7 14 12 14 14
Total 618.5 556.9 11 8 100 100
*) In local currencies
EBIT excluding non-recurring items by business segment
EUR million 10-12/ 10-12/ ChangeFull year results
2012 2011 %
Winter and Outdoor 41.7 45.0 -7
Ball Sports 1.0 -0.7
Fitness 7.9 4.5 76
Headquarters*) -4.1 -2.5
EBIT excluding non-recurring items 46.5 46.3 0
Non-recurring items -24.8 –
EBIT total 21.7 46.3 -53
- Net sales were all-time high at €2.06 billion ($2.67 bb), compared with €1.88 bb a year earlier. In local currencies, net sales increased by 5.1 percent.
- Gross margin was 43.6 percent (43.5 percent).
- EBIT excluding non-recurring items was €136.5 million (€135.5). EBIT margin was 6.6 percent (7.2 percent) excluding non-recurring items. Non-recurring items were EUR -24.8 million (0) and they were related to the restructuring program announced in the January-September 2012 interim report.
- Excluding non-recurring items, earnings per share were €0.65 (€0.71). Earnings per share were €0.48 (€0.71).
- Net cash flow after investing activities was €71.8 million (€-21.4).
- Gearing, or debt ratio, was 57 percent (Dec. 31, 2011: 47 percent). The increase is due to the redemption of the hybrid bond in March 2012 (impact on gearing 12 percentage points).
- Amer Sports board of directors is proposing a dividend of €0.35 per share (€0.33 per share in 2011).
Outlook for 2013
Amer Sports expects the trading environment to remain challenging in 2013. The company will continue to focus on softgoods growth, consumer-driven product and marketing innovation, commercial expansion and operational excellence. In 2013, Amer Sports net sales in local currencies and EBIT excluding non-recurring items are expected to increase from 2012.
KEY FIGURES
EUR million 10-12/ 10-12/ Ch % Ch %*) 2012 2011 Ch % Ch %*)
2012 2011
Net sales 618.5 556.9 11 8 2,064.0 1,880.8 10 5
Gross profit 258.9 235.9 10 7 900.6 817.4 10 6
Gross profit % 41.9 42.4 43.6 43.5
EBIT excluding non- 46.5 46.3 0 136.5 135.5 1
recurring items
EBIT % excluding non- 7.5 8.3 6.6 7.2
recurring items
Non-recurring items**) -24.8 – -24.8 –
EBIT total 21.7 46.3 -53 111.7 135.5 -18
EBIT % 3.5 8.3 5.4 7.2
Financing income and -9.5 -6.1 -29.9 -20.5
expenses
Earnings before taxes 12.2 40.2 81.8 115.0
Net result 5.3 31.1 57.5 90.9
Earnings per share, EUR 0.05 0.25 0.48 0.71
Net cash flow after 96.7 49.0 71.8 -21.4
investing activities
Equity ratio, % at 40.7 45.6
year end
Gearing, % at year end 57 47
Personnel at year end 7,186 7,061 2
Average rates used, 1.28 1.39
**) Non-recurring items are exceptional transactions that are not related to normal business operations. The most common non-recurring items are capital gains, exceptional write-downs, provisions for planned restructuring and penalties. Non-recurring items are normally specified individually if they have a material impact on EBIT.
Remarks from Heikki Takala, president and CEO:
“We finished a good but a highly challenging year 2012 with strong momentum in the fourth quarter. We continued to drive growth, by-passing EUR 2 billion in net sales for the first time. The growth and improvements were broad-based across business areas, geographical core markets and our target emerging markets as well as Business to Consumer channels.
In 2012, our Winter Sports Equipment business was adversely impacted by the previous mild and late winter, and whilst the business did pick up in the fourth quarter, the full year sales were down by 8 percent. Encouragingly, due to our operational efficiency program Focus, Winter Sports Equipment safeguarded mid-single-digit profitability despite the sales decline.
As a group, we delivered net sales growth in line with our target of 5 percent, coupled with a strongly improved free cash flow and healthy balance sheet. Although we did not improve profitability in 2012, we mitigated the impacts of the mild winter 2011/12 and the economic headwinds, and we kept the Group operating profit at the previous year’s level.
Importantly, we did not compromise the long-term development, and throughout 2012 we continued to invest significantly in the strategy execution to ensure that we have strong building blocks in place for continuous future improvement. To further drive this improvement, we are now implementing the earlier announced restructuring program with the objective to drive target scale and synergies and complexity reduction across the Group.
We have now delivered three consecutive years of continuous improvement, hence we see that our strategies are working. We continue executing with confidence.”
