Amer Sports Q2/2016
Acceleration and transformation continue, investments deliveringJuly 28, 2016 – Heikki Takala, President and CEO
Growth and improvement despite headwinds
• Net sales EUR 477.4 million (461.1), +6%*
– Growth driven by Footwear (+15%), Apparel (+24%), and Cycling
(+20%)
– EMEA +7%, Americas +6%, APAC +7% (China +34%)
– B2C +31%, e-commerce +49%
• Gross margin 44.7% (44.1%)
• EBIT EUR -12.1 million (-9.0 excl. IAC), acceleration investments
continued
• Net sales and profitability adversely impacted by the US customer
bankruptcies
• Free cash flow EUR -54.3 million (11.5) due to seasonal fluctuation
• Good momentum in H1
28 July 2016 Amer Sports Interim Report Presentation2
*In local currencies
Significant OPEX investments in H1 to support acceleration
• Digital acceleration, building group-wide consumer database
platform
• Own retail, expecially Arc’teryx:
– Accelerated store openings: new stores in the US (New York and
Chicago), China, Japan, and Austria
– More stores opening soon in China, US (New York and Chicago),
Canada (Toronto), and Italy
• Continuous e-commerce expansion, Canada and Japan going live
• Significant distribution center expansion both in the US and
Europe
• Moving Arc’teryx into a larger production facility in Canada
28 July 2016 Amer Sports Interim Report Presentation3
New Arc’teryx stores in Japan, China and the US
28 July 2016 Amer Sports Interim Report Presentation4
New York SohoKobe, Japan
Yokohama, Japan Shanghai, China
Q2 free cash flow negative, however not different from historical pattern
• Quarterly shifts in repatriation of receivables (40 MEUR) and Asian
vendor payments (20 MEUR)
• Inventory building for H2, 100% of the inventory is current
28 July 2016 Amer Sports Interim Report Presentation5
-54.4
32.8
172.5
-92.2
11.5
43.0
132.8
-84.8
-38.7
44.2
143.9
-119.3
-50.0
67.9
-150
-100
-50
0
50
100
150
200
Q1-16Q4-15Q3-15Q2-15Q1-15Q4-14Q3-14 Q2-16Q2-14Q1-14Q4-13Q3-13Q2-13Q1-13
Balance sheet in a nutshell
28 July 2016 Amer Sports Interim Report Presentation6
EUR million June 30, 2016 June 30, 2015 Dec. 31, 2015
Net debt 599.9 546.3 460.3
Shareholders’ equity 858.2 804.4 949.6
Capital employed 1,458.1 1,350.7 1,409.9
Working capital 456.6 421.3 462.5
Capital turnover, LTM 1.83X 1.85X 1.90X
ROCE, LTM % 15.6 14.7 15.9
Net debt/equity 0.70 0.68 0.48
Equity ratio % 35.8 37.7 37.2
LTM = Last Twelve Months
28 July 2016 Amer Sports Interim Report Presentation7
-40
-20
0
20
40
60
80
100
EBIT excluding items affecting comparability
0
100
200
300
400
500
600
Net sales
Outdoor Q2/2016 (Q2/2015)
28 July 20167
MEURMEUR
-25.4
Q2/12 Q2/12Q2/13
150.9
Q2/13
-27.1
Q2/14
168.7
Q2/14
Net sales EUR 231.0 million, +13%*
• Footwear +15%, Apparel +24%
• Cycling +20%, supported by ENVE
• Sports Instruments -6%, prepared for a big launch in Q3
• Winter Sports Equipment pre-orders -3%, a satisfactory result following several mild
winters
• Agile operating model protects gross margin and cash flow, strong innovation
pipeline secures consumer momentum
EBIT EUR -16.0 million (-18.7 excl. IAC)
Q2/15
174.8
Q2/15
-22.0
Q2/16
209.7
Q2/16
-18.7231.0
-16.0
*In local currencies
Acquisition of ENVE
• Carbon acceleration and global distribution expansion underway
28 July 2016 Amer Sports Interim Report Presentation8
-5
0
5
10
15
20
25
EBIT excluding items affecting comparability
Ball Sports Q2/2016 (Q2/2015)
Net sales EUR 165.5 million, at previous year’s level*
• Sales adversely impacted by the US customer bankruptcies and timing
difference in tennis product launches
EBIT EUR 7.7 million (11.3 excl. IAC)
• Order book is solid and indicates another year of Ball Sports improvement
behind new business model
28 July 2016 Amer Sports Interim Report Presentation9 28 July 20169
MEUR
Q2/12 Q2/13 Q2/14
7.7
Q2/15
7.89.7
6.3
Q2/160
20
40
60
80
100
120
140
160
180
200
Net salesMEUR
Q2/12
144.2
Q2/13 Q2/14
136.2146.5
Q2/15 Q2/16
169.4
11.3
*In local currencies
165.5
Fitness Q2/2016 (Q2/2015)
Net sales EUR 80.9 million, +1%*
• New product and service program (Spinning, Queenax, new cardio…) rolling
out, reaching full speed toward the end of the year
EBIT EUR 4.5 million (5.1 excl. IAC )
28 July 2016 Amer Sports Interim Report Presentation10 28 July 201610
0
20
40
60
80
100
120
140
Net sales
MEUR
Q2/12 Q2/12
56.4
Q2/13 Q2/13Q2/14 Q2/15
64.3
Q2/14
65.1
Q2/15Q2/16
82.0
Q2/16-5
0
5
10
15
20
EBIT excluding items affecting comparability
1.0
4.54.3 4.1 5.1
80.9
*In local currencies
We focus on acceleration with a tremendous pipeline of initiatives
28 July 2016 Amer Sports Interim Report Presentation11
OUTLOOK
Outlook for 2016
28 July 2016 Amer Sports Interim Report Presentation13
• In 2016, Amer Sports net sales in local currencies are expected
to increase and EBIT margin excluding items affecting
comparability to improve from 2015, despite challenging market
conditions.
• The company will focus on growing the core business and
accelerating in five prioritized areas: Apparel and Footwear, US,
China, Business to Consumer, as well as digitally connected
devices and services.
Prioritized, sequenced program continues
Acceleration and transformation
15
Net sales ≥3.5 BEUR,
improving EBIT-%
~2010 – 2013 ~2014 – 2015 ~2016 – 2020
Turnaround
Net sales
1.5 BEUR,
EBIT-% 4%
Net sales 2+ BEUR,
EBIT-% 7%
Net sales ~2.5 BEUR,
EBIT-% toward 10%
Amer Sports Interim Report Presentation
Sustainable Growth Model
and
acquisition readiness
Acceleration and
scaling up,
transformation of
company profile
continues
28 July 2016
APPENDIX
Net sales and EBIT breakdown
28 July 201618
* Excl. IAC
NET SALES
(MEUR)
Q2/
2016
Q1/
2016 2015
Q4/
2015
Q3/
2015
Q2/
2015
Q1/
2015 2014
Q4/
2014
Q3/
2014
Q2/
2014
Q1/
2014
Outdoor 231.0 374.4 1,530.1 501.9 476.6 209.7 341.9 1,371.2 456.7 452.2 174.8 287.5
Ball Sports 165.5 186.7 647.0 165.7 147.8 169.4 164.1 536.7 136.9 112.9 136.2 150.7
Fitness 80.9 74.4 357.3 116.1 89.3 82.0 69.9 320.8 111.7 80.7 65.1 63.3
Total 477.4 635.5 2,534.4 783.7 713.7 461.1 575.9 2,228.7 705.3 645.8 376.1 501.5
EBIT
(MEUR)
Q2/
2016
Q1/
2016* 2015*
Q4/
2015
Q3/
2015
Q2/
2015*
Q1/
2015* 2014*
Q4/
2014*
Q3/
2014*
Q2/
2014*
Q1/
2014
Outdoor -16.0 37.7 161.2 65.6 92.9 -18.7 21.4 125.6 55.0 83.1 -22.0 9.5
Ball Sports 7.7 19.0 46.6 8.2 8.8 11.3 18.3 35.9 12.5 3.9 6.3 13.2
Fitness 4.5 0.3 31.2 15.7 9.1 5.1 1.3 29.7 14.9 7.3 4.1 3.4
Headquarters -8.3 -11.0 -26.9 -5.5 -7.3 -6.7 -7.4 -22.9 -4.7 -6.7 -6.0 -5.5
Total -12.1 46.0 212.1 84.0 103.5 -9.0 33.6 168.3 77.7 87.6 -17.6 20.6
Amer Sports Interim Report Presentation
Business area net sales
28 July 2016 Amer Sports Interim Report Presentation19
Q2/2016 Q2/2015 Ch %
Ch
%* 2015
Footwear 97.0 86.4 12 15 461.2
Apparel 48.8 41.3 18 24 387.2
Winter Sports Equipment 16.1 16.6 -3 -3 400.2
Cycling 38.0 31.7 20 20 138.5
Sports Instruments 31.1 33.7 -8 -6 143.0
Individual Ball Sports 79.5 88.2 -10 -7 315.4
Team Sports 86.0 81.2 6 9 331.6
Fitness 80.9 82.0 -1 1 357.3
Total 477.4 461.1 4 6 2,534.4
*Change in local currencies
Net sales by region
28 July 201620
MEUR
Q2/
2016
Q1/
2016 2015
Q4/
2015
Q3/
2015
Q2/
2015
Q1/
2015 2014
Q4/
2014
Q3/
2014
Q2/
2014
Q1/
2014
EMEA 174.8 278.9 1,114.7 356.8 319.3 168.0 270.6 1,064.0 336.9 321.9 156.1 249.1
Americas 229.8 267.1 1,070.1 313.2 302.0 224.7 230.2 874.3 270.1 249.0 166.0 189.2
Asia
Pacific 72.8 89.5 349.6 113.7 92.4 68.4 75.1 290.4 98.3 74.9 54.0 63.2
Total 477.4 635.5 2,534.4 783.7 713.7 461.1 575.9 2,228.7 705.3 645.8 376.1 501.5
Amer Sports Interim Report Presentation
Outdoor
Sales development by region in Q2/2016
28 July 2016 Amer Sports Interim Report Presentation21
Fitness Total
EMEA Americas APAC
Ball Sports
EMEA Americas APAC Total
MEUR Ch, %* MEUR Ch, %* MEUR Ch, %* MEUR Ch, %*
Outdoor 125.7 8 65.8 21 39.5 18 231.0 13
Ball Sports 31.7 8 116.0 1 17.8 -12 165.5 0
Fitness 17.4 -3 48.0 0 15.5 11 80.9 1
Total 174.8 7 229.8 6 72.8 7 477.4 6
* Change in local currencies
231.0 165.5 80.9 477.4
17%
68%
11%19%
70%
19%22%
59%
15%37%
48%
54%
29%
Balance sheet
28 July 2016 Amer Sports Interim Report Presentation22
MEUR
June 30,
2016
June 30,
2015
Goodwill and other intangible non-current assets 665.7 592.6
Tangible non-current assets and other non-current assets 344.5 326.5
Inventories and work in progress 585.7 517.8
Receivables 574.2 584.5
Cash and cash equivalents 229.9 109.6
Shareholders’ equity 858.2 804.4
Interest bearing liabilities 829.8 655.9
- Long-term 777.7 480.8
- Current 52.1 175.1
Other liabilities 712.0 670.7
Total 2,400.0 2,131.0
Refinancing needs well covered
28 July 2016 Amer Sports Interim Report Presentation23
• Cash EUR 229.9 million and
unused committed facilities EUR
150 million (June 30, 2016)
• Commercial paper program in
size of EUR 500 million; out of
which EUR 49.9 million utilized
• No scheduled repayments of
long-term loans in 2016 or in
2017.
• Average interest rate of loan
portfolio 2.1% (June 30, 2015
2.8%)
0.0
50.0
100.0
150.0
200.0
250.0
300.0
350.0
Bonds
Bank loans
CommercialPapers
Other
Free cash flow
28 July 201624
-150
-100
-50
0
50
100
150
200
Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16
Cash flow from operating activities – net capital expenditures – restricted cash
Net capital expenditure = total capital expenditure less proceeds from sale of assets
Amer Sports Interim Report Presentation
Impact of new ESMA guidelines
New ESMA (European Securities and Markets Authority) guidelines
on Alternative Performance Measures (APMs) are effective for the
financial year 2016. Amer Sports presents APMs to reflect the
underlying business performance and to enhance comparability
between financial periods. APMs should not be considered as a
substitute for measures of performance in accordance with the IFRS.
As of Q1 2016, Amer Sports relabels the previously referenced
"excluding non-recurring items" with "excluding items affecting
comparability” (IAC). Operating segments’ EBIT is reported excluding
IAC. Items affecting comparability and APMs used by Amer Sports
are defined in note 10 of the Q2 interim report.
28 July 2016 Amer Sports Interim Report Presentation25
Changes to Amer Sports Insider Register and Disclosure Policy as of July 3, 2016
Notification and publication of transactions of managers and
their closely associated persons
• The following persons have been deemed to discharge managerial
responsibilities in Amer Sports:
• Members and secretary of the Board of Directors
• CEO
• Members of the Executive Board
28 July 2016 Amer Sports Interim Report Presentation26
Contact information
• Heikki Takala, President and CEO
Tel. +358 20 712 2510
• Jussi Siitonen, CFO
Tel. +358 20 7122511
• Päivi Antola, Director, Corporate Communications and IR
Tel. +358 20 712 2537
www.amersports.com
28 July 201627 Amer Sports Interim Report Presentation
DisclaimerStatements in this presentation, which are not historical facts, such as expectations, anticipations, beliefs and estimates,are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995.Such statements involve risks and uncertainties which may cause actual results to materially differ from those expressedin such forward-looking statements.Amer Sports assumes no responsibility to update any of the forward-looking statements contained herein.No representation or warranty, express or implied, is made or given by or on behalf of Amer Sports or its employees orany other person as to the accuracy, completeness or fairness of the information or opinions contained in this presentation.
www.amersports.com
28 July 201628 Amer Sports Interim Report Presentation