Amer Sports net sales decreased by 2.1% to EUR 355.3 million ($465.4 m). In local currencies net sales decreased by 7%.   The company's net loss more than doubled from the quarter, growing 108% to a loss of EUR 10.8 million (-$14 mm).


Net sales by business segment were as follows: Winter and Outdoor 46% (Winter Sports Equipment 10%), Ball Sports 40% and Fitness 14%. Winter and Outdoor and Ball Sports sales were at last year's level. Net sales of Fitness decreased by 16%. In local currency terms, Winter and Outdoor net sales were at last year's level, Ball Sports decreased by 8% and Fitness decreased by 25%.
 
The split of net sales by geographical segment was as follows: the Americas 46%, EMEA 44% and Asia Pacific 10%. Sales in Asia Pacific increased by 9%, were at last year's level in EMEA and decreased in the Americas by 5%. In local currency terms, net sales increased by 2% in EMEA, were at last year's level in Asia Pacific, and decreased 15% in the Americas.
 
The group's EBIT was EUR -6.9 million ($9.0 m). The weakened result reflects challenging market conditions particularly in the USA.
 
Earnings before taxes were EUR -14.4 million ($18.7 million) Earnings per share were EUR -0.15 ($0.20). Net financial expenses amounted to EUR -7.5 million ($9.8 m).

Winter and Outdoor
In January-March, net sales were at last year's level in local currency terms. The breakdown of net sales was as follows: Apparel and Footwear 50%, Winter Sports Equipment 22%, Cycling 17% and Sports Instruments 11%. EMEA accounted for 70%, the Americas for 21%, and Asia Pacific for 9% of net sales. Sales in local currencies were up 5% in EMEA, down 8% in Asia Pacific, and down 8% in the Americas.




































































*) In local currency terms

 

Business areas

Half of the segmental sales in the first quarter are related to the Apparel and Footwear business, which delivers the majority of its spring/summer collection during the first three months of the year. The sales grew by 18%, the growth being balanced over Salomon footwear, Salomon apparel and gear as well as Arc'teryx. Weakness in North America was well compensated by success in the Central European markets. The sell-through of the key outdoor and trail running footwear products continues to be strong. The order intake for the fall/winter collection is more cautious than for the spring/summer season. Production commitments are being scaled down to reduce the inventory risks and improve cash flow.

 

The end of the season 2008/09 provided no surprises to the Winter Sports Equipment business, with sales at last year's level. The expense level is clearly lower due to the restructuring, and the industrial synergies will be visible in the 2009/10 product deliveries. The pre-order season is still ongoing, alpine Europe and Scandinavia benefiting from good winter conditions especially in cross-country skiing, while ordering in North America is slow which is impacting especially the snowboard business. The final changes to the new industrial structure were completed during the first quarter.

 

Bicycle component manufacturer Mavic's deliveries to OEM manufacturers were sharply lower in the first quarter, as the whole supply chain reduced its inventories anticipating softer markets. Mavic also had capacity constrains in high end wheels due to the recall of R-SYS front wheels announced in January 2009. The net sales were thus 21% lower than last year in local currencies. This is the first year with Mavic-branded apparel and gear in the markets, and their sales are progressing according to expectations.

 

Net sales of Sports Instruments were 16% below last year's level in local currencies. The decline in net sales reflects the economic environment, with especially the diving market being affected. On the other hand, in the training category consumer demand was good and saw double-digit growth compared to the previous year. A large cost savings program has been initiated to protect Suunto's profitability.
 
The EBIT of EUR -10.9 million ($14.3 m) improved by 28% versus last year in local currencies. The improvement reflects the lower cost level in the Winter Sports Equipment business and the strong growth in sales of Apparel and Footwear.

 

 

Ball Sports
In January-March Ball Sports' net sales of EUR 142.9 million ($187.2 m)declined by 8% in local currencies. The breakdown of net sales was as follows: Racquet Sports 45%, Team Sports 41% and Golf 14%. Of the net sales, the Americas generated 64%, EMEA 24% and Asia Pacific 12%. On a currency neutral basis, Asia Pacific grew by 12% and EMEA and the Americas declined by 3% and 13%, respectively.

 




























































*) In local currency terms

 

In January-March Ball Sports' net sales of EUR 142.9 million declined by 8% in local currencies. The breakdown of net sales was as follows: Racquet Sports 45%, Team Sports 41% and Golf 14%. Of the net sales, the Americas generated 64%, EMEA 24% and Asia Pacific 12%. On a currency neutral basis, Asia Pacific grew by 12% and EMEA and the Americas declined by 3% and 13%, respectively.

 

Business areas

In local currencies, the Racquet Sports division declined by 4%. In a local currencies Asia Pacific grew by 13%, EMEA was at last year's level and the Americas declined by 12%. The growth in Asia Pacific is driven by the expanded distribution in China and a strengthening position in the badminton category. The decline in the Americas is primarily driven by the United States where net sales are adversely impacted by the economic recession. In the United States, retailers continue to remain cautious and consumers are seeking value trading down to lower price points.

 

In local currencies, Team Sports declined by 9%. Asia Pacific grew by 47% in local currencies. The EMEA and Americas declined by 6% and 10%, respectively. 85% of the Team Sports business is conducted in the United States. Therefore, the overall net sales for Team Sports are being heavily impacted by the economic recession. In the United States, the discount retailers continue to perform well and the higher priced premium segments are experiencing declines.

 

The Golf segment saw a 17% decline versus the previous year in local currencies. The net sales declines by region are Americas 26%, Asia Pacific 16% and EMEA 7%. Market research shows the Golf industry has declined more than other sport categories as a result of the economic recession and the higher cost of participation. Manufacturers are focused on providing value to the consumer at lower price points.  
 
The EBIT of EUR 11.5 million ($15.1 m) is 8% of net sales. The EBIT declined by 33% versus last year in local currency terms by volume declines and margin pressures. The margin challenges are driven by a combination of economic pressures and change in sales mix.

Fitness
In January-March, Fitness' net sales declined by 25% in local currencies to EUR 48.0 million. The Americas accounted for 77%, EMEA for 16%, and Asia Pacific for 7% of net sales. In local currency terms, sales were down 12% in EMEA, 27% in Asia Pacific and 27% in the Americas.



FITNESS































*) In local currency terms

 

In January-March, Fitness' net sales declined by 25% in local currencies to EUR 48.0 million. The Americas accounted for 77%, EMEA for 16%, and Asia Pacific for 7% of net sales. In local currency terms, sales were down 12% in EMEA, 27% in Asia Pacific and 27% in the Americas.

 

The market situation is unchanged since the previous quarter of last year with the general economic climate being the largest performance driver.
 
Consumer products sales were impacted by significant lower consumer spending due to the uncertain economic environment. Consumer sales were affected by both the overall withdrawal from discretionary spending by many families and by a significant reduction in the number of specialty dealers compared to the prior year.
 
In a release, the company said demand for commercial equipment for both North America and EMEA were impacted as customers are deferring purchase decisions in the light of the financial uncertainty. Availability of credit and financing (i.e. leasing) are also having an impact particularly in Europe.

 

The distribution lost due to the bankruptcy of two major dealers has not yet been replaced. The commercial business decline is driven by tight credit markets which are making it more difficult for small customers to lease equipment and by a “wait and see” attitude of other customers that are concerned about the general economic outlook. Additionally, many customers are putting new projects on hold which is restricting the business to replacement sales rather than the new facility sales that have driven the industry in the last few years.
 
EBIT decreased to EUR -3.4 million ($-4.5 m) due to the significant fall in sales and lower gross margins resulting from a lower capacity utilization rate and pricing pressure. Precor will continue to focus on cost savings to return to profitability.

 

Amer Sports said its full-year outlook is clouded by the uncertainty in consumer demand in general. Visibility will improve during Q2 when the pre-orders in winter sports equipments are collected, but the uncertainty surrounding the Fitness segment's performance will remain high throughout the year. Due to the prevailing uncertainty, Amer Sports has decided to give further guidance after the pre-order season in winter sports equipment is over
 

 

PERSONNEL

At the end of March, the Group employed 6,293 people (6,351). The Group employed an average of 6,272 people (6,319) during the review period.

 

































 
March 31, 2009
March 31, 2008
Change %

Winter and Outdoor
3,776
3,746
1

Ball Sports
1,695
1,700
0

Fitness
751
838
-10

Headquarters
71
67
6

Total
6,293
6,351
-1

 




























 
March 31, 2009
March 31, 2008
Change %

EMEA
3,421
3,419
0

Americas
2,300
2,393
-4

Asia Pacific
572
539
6

Total
6,293
6,351
-1

 

SHARES AND SHAREHOLDERS

At the end of March Amer Sports had 12,385 registered shareholders (12,300). Nominee registered represented 41.7% (45.0%) of the shares.

 

During the period, a total of 13.6 million Amer Sports shares were traded on the NASDAQ OMX Helsinki to a total value of EUR 77.5 million. The share turnover was 18.8% (of the average number of shares excluding own shares).

 

At the close of the review period, the last trade in Amer Sports Corporation shares was EUR 4.99. The high for the period on the NASDAQ OMX Helsinki was EUR 6.66 and the low EUR 4.69. The average share price was EUR 5.68.

 

On March 31, 2009, the company had a market capitalization of EUR 362.8 million excluding own shares. The company has 340,900 own shares. The number of own shares corresponds to 0.5% of all Amer Sports shares.

 

Major changes in holdings, January-March 2009

Amer Sports Corporation received information on February 19, 2009 to the effect that Novator Finland Oy has converted all of its NASDAQ OMX forward contracts into direct holdings in shares of Amer Sports Corporation on February 18, 2009. After settlement of the NASDAQ OMX forward contracts concerning 7,000,000 shares in Amer Sports Corporation, Novator Finland Oy then held 14,688,900 shares representing 20.11% of the shares and voting rights in Amer Sports Corporation.

 

Amer Sports Corporation received information on February 19, 2009 to the effect that the Danske Bank A/S Helsinki Branch's share capital and voting rights of Amer Sports fell under 5% (1/20) on February 23, 2009 due to a transaction completed on February 18, 2009. The Danske Bank A/S Helsinki Branch held then 0 shares in Amer Sports Corporation.

 

 

 

 

CONSOLIDATED RESULTS  (EUR million)