2010-02-04 12:00:00 CET
2010-02-04 12:02:36 CET
REGULATED INFORMATION
Amer Sports - Financial Statement Release
Amer Sports Corporation Financial Results 2009 (IFRS)
Amer Sports Corporation
FINANCIAL STATEMENT BULLETIN
February 4, 2010 at 1:00 pm
OCTOBER-DECEMBER, 2009
* Amer Sports Q4/09 net sales of EUR 482.8 million fell by 3% (495.3). In
local currencies, net sales were at last year's level. Net sales fell by 6%
in the Americas, increased by 8% in the EMEA region and fell by 4% in Asia
Pacific in local currency terms.
* EBIT was EUR 39.4 million (35.2). Earnings per share were EUR 0.37 (0.20).
* Winter and Outdoor sales grew by 3% in local currencies. EBIT grew to EUR
42.5 million (36.7). Winter Sports Equipment's profitability improved
significantly.
* Ball Sports sales fell by 8%. The fall of EBIT of EUR 2.2 million (3.4)
reflects a slower than anticipated top-line.
* Fitness sales grew by 10%. EBIT of EUR -0.5 million (-2.3) includes bad debt
provisions of EUR 5 million.
JANUARY-DECEMBER, 2009
* Amer Sports net sales were at EUR 1,533 million (1,577), falling by 3%. In
local currencies, net sales fell by 4%. Net sales fell by 12% in the
Americas, increased by 3% in the EMEA region and fell by 3% in Asia Pacific
in local currency terms.
* EBIT was EUR 43.8 million (78.9). The result reflects the challenging
operating environment in North America as well as a one-time charge of EUR
5 million (net income EUR 7 million). Earnings per share were EUR 0.28
(0.37). Taxes were 6.0 million positive (-11.6) due to increased deferred
tax assets.
* Amer Sports financial position improved significantly with net debt
declining by EUR 333.1 million to EUR 282.5 million. The reduction reflects
a strong cash flow from operating activities of EUR 181.6 million (10.5),
which, was driven by a successful working capital reduction program.
Furthermore, net proceeds of EUR 151.5 million were raised with a rights
offering and EUR 60 million with a hybrid bond. This resulted in a
substantial improvement in gearing from 121% to 38%.
* Amer Sports Board of Directors proposes a dividend of EUR 0.16 per share
(0.16 per share in 2008).
+-----------------------+------+------+----+------+-------+-------+----+------+
| |10-12/|10-12/| | | | | | |
|EUR million | | |Ch %|Ch %*)| 2009| 2008|Ch %|Ch %*)|
| | 2009| 2008| | | | | | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Net sales | 482.8| 495.3| -3| 1|1,533.4|1,576.6| -3| -4|
+-----------------------+------+------+----+------+-------+-------+----+------+
|Gross profit | 196.5| 184.3| 7| 11| 620.0| 633.0| -2| -4|
+-----------------------+------+------+----+------+-------+-------+----+------+
|EBIT | 39.4| 35.2| 12| 16| 43.8| 78.9| -44| -46|
+-----------------------+------+------+----+------+-------+-------+----+------+
|Of net sales | 8.2| 7.1| | | 2.9| 5.0| | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Financing income and | | | | | | | | |
| | -7.1| -11.3| | | -18.4| -33.3| | |
|expenses | | | | | | | | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Earnings before taxes | 32.3| 23.9| 35| | 25.4| 45.6| -44| |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Net result | 36.6| 17.7| | | 31.4| 34.0| -8| |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Earnings per share, EUR| 0.37| 0.20| | | 0.28| 0.37| | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Equity per share, EUR | | | | | 6.05| 5.44| | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|ROCE, % | | | | | 4.3| 7.9| | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|ROE, % | | | | | 5.0| 6.7| | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Equity ratio, % | | | | | 48.2| 30.6| | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Gearing, % | | | | | 38| 121| | |
+-----------------------+------+------+----+------+-------+-------+----+------+
|Personnel at year end | | | | | 6,331| 6,338| | |
+-----------------------+------+------+----+------+-------+-------+----+------+
*) Change in local currency terms
Share-based key indicators have been adjusted for the impact of the share issue
in 2009.
OUTLOOK AND GUIDANCE FOR 2010
Amer Sports does not anticipate a quick recovery in the sporting goods market,
and therefore the company's key priority is to improve its profitability through
gross margin improvements and continued tight cost control. The company will
also continue to focus on strict working capital management, although an
improvement similar to the previous year cannot be expected. Capital
expenditures and other investments will remain at the previous year's level. The
company's tax rate is expected to be approximately 20%.
MESSAGE FROM PEKKA PAALANNE, ACTING PRESIDENT AND CEO:"Amer Sports declining sales trend turned slightly positive towards the end of
the fourth quarter, although this reflected more the timing of winter sports
deliveries and weak comparables in the Fitness segment than a recovery in the
market. Our profitability also started to improve thanks to programs initiated
during 2009, and we expect the favorable development to continue during 2010.
As a whole, last year was a very challenging one due to the recessionary
environment. Consequently, Amer Sports results were the weakest during the past
decade. Our key priority in 2009 was to strengthen the balance sheet, and in
this task we exceeded our own plans. I'm particularly proud of the results of
the working capital reduction program in which the whole organization was
involved. During the year, we re-established a strong balance sheet and our
gearing fell from 121% to 38%.
Over the past decade Amer Sports has undergone significant changes and has
become a leading global sporting goods company. With the appointment of Heikki
Takala as our new CEO and President, from April 1, 2010, the company will enter
a new era."
For further information, please contact:
Tommy Ilmoni, Vice President, IR and Corporate Communications, tel. +358
9 7257 8233
Pekka Paalanne, Acting President and CEO, tel. +358 9 7257 8212
TELEPHONE CONFERENCE
An English-language telephone conference call for investors and analysts will be
held on Thursday, February 4 at 3:00 pm Finnish time. To participate in the
conference call, please call +44 (0)203 003 2666 (UK/international dial-in
number). The conference can also be followed from a direct transmission on the
Internet, at www.amersports.com <http://www.amersports.com/>.
A recorded version will be available later at the same address: replay number
+44 208 196 1998 and access code 6801881#.
FINANCIAL RESULTS 2009 (IFRS)
The sporting goods industry's market conditions were challenging throughout
2009. Weak global economic conditions and uncertainty about the financial
markets' performance affected the sporting goods sector, including Amer Sports.
The US market continued to suffer more than the European market and, in general,
there was less demand for high-ticket items. For Amer Sports this meant large
sales declines in the Fitness and Golf businesses in particular. On the other
hand, the demand for low-ticket items remained relatively healthy, and some
categories even saw clear growth, such as Salomon's footwear business.
NET SALES AND EBIT IN OCTOBER-DECEMBER
Net sales for Amer Sports were at EUR 482.8 million (495.3), showing a fall of
3%. In local currencies, net sales were at last year's level.
Net sales by business segment
+------------------+------+------+------+------+----------+----------+
| |10-12/|10-12/|Change|Change|% of sales|% of sales|
| | | | | | | |
|EUR million | 2009| 2008| %| %*)| 10-12/09| 10-12/08|
+------------------+------+------+------+------+----------+----------+
|Winter and Outdoor| 329.2| 326.6| 1| 3| 68| 66|
+------------------+------+------+------+------+----------+----------+
|Ball Sports | 94.7| 110.0| -14| -8| 20| 22|
+------------------+------+------+------+------+----------+----------+
|Fitness | 58.9| 58.7| 0| 10| 12| 12|
+------------------+------+------+------+------+----------+----------+
|Total | 482.8| 495.3| -3| 1| 100| 100|
+------------------+------+------+------+------+----------+----------+
*) In local currency terms
Geographic breakdown of net sales
+------------+------+------+------+------+----------+----------+
| |10-12/|10-12/|Change|Change|% of sales|% of sales|
| | | | | | | |
|EUR million | 2009| 2008| %| %*)| 10-12/09| 10-12/08|
+------------+------+------+------+------+----------+----------+
|Americas | 154.6| 178.8| -14| -6| 32| 36|
+------------+------+------+------+------+----------+----------+
|EMEA | 266.1| 249.5| 7| 8| 55| 50|
+------------+------+------+------+------+----------+----------+
|Asia Pacific| 62.1| 67.0| -7| -4| 13| 14|
+------------+------+------+------+------+----------+----------+
|Total | 482.8| 495.3| -3| 1| 100| 100|
+------------+------+------+------+------+----------+----------+
*) In local currency terms
EBIT by business segment
+------------------+------+------+------+------+----------+----------+
| |10-12/|10-12/|Change|Change|% of sales|% of sales|
| | | | | | | |
|EUR million | 2009| 2008| %| %*)| 10-12/09| 10-12/08|
+------------------+------+------+------+------+----------+----------+
|Winter and Outdoor| 42.5| 36.7| 16| 20| 12.9| 11.2|
+------------------+------+------+------+------+----------+----------+
|Ball Sports | 2.2| 3.4| -35| -28| 2.3| 3.1|
+------------------+------+------+------+------+----------+----------+
|Fitness | -0.5| -2.3| | | | |
+------------------+------+------+------+------+----------+----------+
|Headquarters | -4.8| -2.6| | | | |
+------------------+------+------+------+------+----------+----------+
|Total | 39.4| 35.2| 12| 16| 8.2| 7.1|
+------------------+------+------+------+------+----------+----------+
*) In local currency terms
The Group's EBIT was EUR 39.4 million (35.2). The improvement reflects to a
large extent both higher sales and a better profitability within the Winter
Sports Equipment business area. EBIT includes bad debt provisions of EUR 5
million in the Fitness segment.
Net financial expenses amounted to EUR 7.1 million (11.3). Earnings before taxes
were EUR 32.3 million (23.9), and earnings per share came to EUR 0.37 (0.20).
NET SALES AND EBIT IN JANUARY-DECEMBER 2009
Amer Sports net sales were EUR 1,533.4 million (1,576.6), seeing a fall of 3%.
In local currency terms, net sales fell by 4%.
Net sales by business segment
+------------------+-------+-------+------+------+----------+----------+
| | | |Change|Change|% of sales|% of sales|
| | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008|
+------------------+-------+-------+------+------+----------+----------+
|Winter and Outdoor| 862.6| 860.8| 0| 0| 56| 55|
+------------------+-------+-------+------+------+----------+----------+
|Ball Sports | 476.7| 495.5| -4| -7| 31| 31|
+------------------+-------+-------+------+------+----------+----------+
|Fitness | 194.1| 220.3| -12| -15| 13| 14|
+------------------+-------+-------+------+------+----------+----------+
|Total |1,533.4|1,576.6| -3| -4| 100| 100|
+------------------+-------+-------+------+------+----------+----------+
*) In local currency terms
Geographic breakdown of net sales
+------------+-------+-------+------+------+----------+----------+
| | | |Change|Change|% of sales|% of sales|
| | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008|
+------------+-------+-------+------+------+----------+----------+
|Americas | 620.5| 677.8| -8| -12| 40| 43|
+------------+-------+-------+------+------+----------+----------+
|EMEA | 735.0| 723.0| 2| 3| 48| 46|
+------------+-------+-------+------+------+----------+----------+
|Asia Pacific| 177.9| 175.8| 1| -3| 12| 11|
+------------+-------+-------+------+------+----------+----------+
|Total |1,533.4|1,576.6| -3| -4| 100| 100|
+------------+-------+-------+------+------+----------+----------+
*) In local currency terms
EBIT by business segment
+------------------+-----+-------+------+------+----------+----------+
| | | |Change|Change|% of sales|% of sales|
| | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008|
+------------------+-----+-------+------+------+----------+----------+
|Winter and Outdoor| 46.5| 41.1| 13| 17| 5.4| 4.8|
+------------------+-----+-------+------+------+----------+----------+
|Ball Sports | 23.5| 37.0| -36| -40| 4.9| 7.5|
+------------------+-----+-------+------+------+----------+----------+
|Fitness | -7.5| 3.8| | | | 1.7|
+------------------+-----+-------+------+------+----------+----------+
|Headquarters |-18.7|-3.0**)| | | | |
+------------------+-----+-------+------+------+----------+----------+
|Total | 43.8| 78.9| -44| -46| 2.9| 5.0|
+------------------+-----+-------+------+------+----------+----------+
*) In local currency terms
**) Including EUR 13 million capital gain
The Group's EBIT was EUR 43.8 million (78.9). The weakened results reflect
mainly Amer Sports operations in North America as well as a one-time charge of
EUR 5 million (net income EUR 7 million).
Net financial expenses, which amounted to EUR 18.4 million (33.3), included EUR
6.2 million in unrealized foreign exchange gains. Earnings before taxes came to
EUR 25.4 million (45.6). Taxes were EUR 6.0 million positive (-11.6) due to
increased deferred net tax assets. The deferred tax adjusted tax rate was 18%
(25%), which is in line with the Group's on-going tax rate of 20%. Earnings per
share were EUR 0.28 (0.37).
CAPITAL EXPENDITURE
The Group's capital expenditure on fixed assets totaled EUR 39.5 (43.1) million,
which is well in line with the depreciations of EUR 35.0 (38.2) million. The
biggest projects were the roll-out ofthe global IT platform of EUR 10 million
and Precor's new strength equipment facility of EUR 4.5million in North
Carolina, USA.
RESEARCH AND DEVELOPMENT
EUR 52.0 million (55.6) was invested in research and development, representing
3.4% of net sales. Winter and Outdoor's share of R&D expenditure was 62%, while
Ball Sports accounted for 12%, and Fitness for 26%.
FINANCIAL POSITION AND CASH FLOW
Amer Sports had interest-bearing liabilities at the end of December of EUR
404.1 million (687.7), consisting of short-term debt of EUR 121.3 million and
long-term debt of EUR 282.8 million. Liquid assets amounted to EUR 121.6 million
(72.1) at the end of the period. The Group's net debt was EUR 282.5 million
(615.6). The hybrid bond is treated as equity. Amer Sports' total unused
committed credit facilities amounted to EUR 275.0 million.
+----------------+----------+-----+-----+----------+----+-------+-----+
| | | | |Syndicated| | | |
| |Commercial| | Bank| | |Pension| |
|Type of debt | |Other| | credit|Bond| |Other|
| | papers| | loan| | | loan| |
| | | | |facility*)| | | |
+----------------+----------+-----+-----+----------+----+-------+-----+
|EUR million | 112| 9|69**)| 110| 75| 26| 3|
+----------------+----------+-----+-----+----------+----+-------+-----+
|Share of debt, %| 28| 2| 17| 27| 19| 6| 1|
+----------------+----------+-----+-----+----------+----+-------+-----+
| | | |2011,| 2011,| | | |
|Maturity |< 6 months| 2010| | |2011| | |
| | | | 2012| 2012| | | |
+----------------+----------+-----+-----+----------+----+-------+-----+
*) Unused portion was EUR 215 million
**) USD 100 million
Amer Sports has a EUR 325 million committed revolving credit facility, maturing
in 2011 and 2012, of which EUR 110 million has been used. Furthermore, the
company has, as of January 2009, committed revolving credit facilities of EUR
60 million maturing in January 2010.
Amer Sports' long-term debt consists of a EUR 75 million private placement bond
maturing in 2011, a USD 100 million term loan and draw-downs totaling EUR 110
million as part of the original EUR 575 million loan syndicate of 2005 (maturing
in 2011 and 2012), and a EUR 25.7 million pension loan.
Short-term financing is mainly raised with a EUR 500 million domestic commercial
paper program, of which EUR 112.3 million had been used by the end of December.
In March, Amer Sports Corporation issued a EUR 60 million hybrid bond in order
to strengthen its capital structure and to refinance existing debt. The coupon
rate of the bond is 12.0% per annum. The bond has no maturity, but the company
may call in the bond after three years. The hybrid bond is unsecured and
subordinated to all senior debt and is treated as equity in Amer Sports
consolidated financial statements. The hybrid bond does not confer shareholders'
rights, nor does it dilute the holdings of shareholders.
The equity ratio at the end of December was 48.2 (30.6) and gearing was 38%
(121).
Net cash flow from operating activities after interest and taxes was EUR 181.6
million (10.5). The substantial improvement in cash flow reflects a successful
working capital reduction program. Net cash flow from investment activities was
EUR -41.1 million (-14.6).
EUR 160 million rights offering
As part of Amer Sports' measures to improve its balance sheet, the company
undertook a rights offering that was completed on October 23, 2009. The proceeds
from the rights offering have been used to strengthen Amer Sports' financial
position and to improve the company's operational and strategic flexibility. As
a result of the rights offering, the number of Amer Sports' shares increased by
48,471,734 to 121,517,285 shares. The total net proceeds of the rights offering
amounted to EUR 151.5 million.
BUSINESS SEGMENT REVIEWS
WINTER AND OUTDOOR
+------------------+------+------+------+------+-----+-----+------+------+
| |10-12/|10-12/|Change|Change| | |Change|Change|
| | | | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008| %| %*)|
+------------------+------+------+------+------+-----+-----+------+------+
|Net sales | | | | | | | | |
+------------------+------+------+------+------+-----+-----+------+------+
|Winter Sports | | | | | | | | |
| | 203.7| 196.7| 4| 6|371.7|378.9| -2| -1|
|Equipment | | | | | | | | |
+------------------+------+------+------+------+-----+-----+------+------+
|Apparel and | | | | | | | | |
| | 73.8| 73.9| 0| 2|304.7|277.9| 10| 11|
|Footwear | | | | | | | | |
+------------------+------+------+------+------+-----+-----+------+------+
|Cycling | 27.1| 31.3| -13| -12|100.4|114.2| -12| -13|
+------------------+------+------+------+------+-----+-----+------+------+
|Sports Instruments| 24.6| 24.7| 0| 4| 85.8| 89.8| -4| -5|
+------------------+------+------+------+------+-----+-----+------+------+
|Net sales, total | 329.2| 326.6| 1| 3|862.6|860.8| 0| 0|
+------------------+------+------+------+------+-----+-----+------+------+
|EBIT | 42.5| 36.7| 16| 20| 46.5| 41.1| 13| 17|
+------------------+------+------+------+------+-----+-----+------+------+
|Personnel, Dec 31 | | | | |3,940|3,777| 4| |
+------------------+------+------+------+------+-----+-----+------+------+
*) In local currency terms
In 2009, Winter and Outdoor's net sales of EUR 862.6 million (860.8) were at
last year's level in local currency terms. The breakdown of net sales by
business area was as follows: Winter Sports Equipment 43%, Apparel and Footwear
35%, Cycling 12%, and Sports Instruments 10%. In 2009, the EMEA accounted for
68% of net sales, the Americas for 21%, and Asia Pacific for 11%.
+---------------+------+------+------+------+-----+-----+------+------+
| |10-12/|10-12/|Change|Change| | |Change|Change|
| | | | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008| %| %*)|
+---------------+------+------+------+------+-----+-----+------+------+
|Americas | 50.8| 60.8| -16| -12|181.1|202.3| -10| -12|
+---------------+------+------+------+------+-----+-----+------+------+
|EMEA | 236.1| 219.2| 8| 9|585.4|558.8| 5| 6|
+---------------+------+------+------+------+-----+-----+------+------+
|Asia Pacific | 42.3| 46.6| -9| -6| 96.1| 99.7| -4| -6|
+---------------+------+------+------+------+-----+-----+------+------+
|Total net sales| 329.2| 326.6| 1| 3|862.6|860.8| 0| 0|
+---------------+------+------+------+------+-----+-----+------+------+
*) In local currency terms
The EBIT of EUR 46.5 million (41.1) increased by 17% in local currency terms.
The improvement reflects clearly better profitability in Winter Sports Equipment
and the continued good level of profitability in Apparel and Footwear. The
profitability of both Cycling and Sports Instruments weakened mainly due to
lower sales. In October-December EBIT grew to EUR 42.5 million (36.6). Winter
Sports Equipment's profitability improved significantly.
Winter Sports Equipment
In 2009, Winter Sports Equipment's net sales of EUR 371.7 million (378.9) were
at last year's level in local currencies. The biggest product categories were
alpine ski equipment, representing 78% of net sales, cross country 12%, and
snowboards 10%. Net sales of alpine ski equipment fell in local currency terms
by 3%, snowboards fell by 10% and cross country increased by 22%.
The development of sales showed very different patterns in the key markets
during 2009. The alpine and Nordic countries started to show signs of recovery
with favorable weather conditions. The North American market continued to weaken
whereas the Asian market was flat. Industry sales were relatively stable as a
whole, at approximately EUR 1.4 billion: alpine ski equipment EUR 1.0 billion,
snowboards EUR 0.3 billion, and cross-country ski equipment EUR 0.1 billion. The
EMEA continued to be the largest winter sports region representing 71% of global
sales, followed by the Americas with 17%, and Asia Pacific with 12%.
After significant restructuring in 2008, 2009 was the first year for the Winter
Sports Equipment business operating under its new structure. Winter Sports
Equipment successfully completed its consolidation of the manufacturing sites
from ten to six at the beginning of the year. In addition, the integration of
the Bulgarian ski factory, which was acquired in 2008, proceeded according to
plan. The Winter Sports Equipment business area produced a positive result after
a very challenging period.
Apparel and Footwear
Net sales in Apparel and Footwear increased by 11% in local currency terms to
EUR 304.7 million (277.9). Net sales by product categories were as follows:
footwear 55% and apparel and gear 45%. Net sales of footwear increased in local
currency terms by 15%, and apparel and gear by 6%. The EMEA continued to be the
largest business region representing 69% of global sales, followed by the
Americas with 26%, and Asia Pacific with 5%.
Salomon strengthened its global position in the outdoor footwear market in
2009. The main growth drivers were the trail running footwear and the new
progressive hiking-backpacking offer. The unique positioning of Salomon as the
mountain apparel brand continued to generate positive results with sales growing
faster than the market, especially in Europe. Ski apparel continued to grow and
Salomon strengthened its position on the market. The Apparel and Footwear
business is weighted towards the winter season. However, the outdoor and
trail-running spring/summer collections have continued to be the fastest growing
categories.
Despite a tough US environment and high exposure in the US market, Arc'teryx
managed to increase its sales. This was mainly driven by a successful
spring/summer collection.
Even though the US was the toughest market in 2009, Amer Sports estimates that
its Apparel and Footwear business area's market share increased in the US. The
outdoor trend remained strong and trail running as a category continued to gain
popularity. The business area's good profitability was maintained in 2009.
Cycling
Due to the challenging business climate in 2009, both independent bike dealers
and bike manufacturers clearly reduced their inventories during the year. This
resulted in a major fall in OEM orders and weak demand in the US especially.
Mavic saw net sales fall in local currencies by 13% to EUR 100.4 million
(114.2). The biggest product categories were rims and wheels, representing 83%
of net sales, and apparel and footwear 14%. Net sales of rims and wheels fell in
local currency terms by 16%, and apparel and footwear by 3%. The distribution of
Cycling's net sales by geographical region was as follows: EMEA 65%, Asia
Pacific 21%, and the Americas 14%.
At the beginning of 2009, Mavic decided to recall its R-Sys front wheels and
replace the original carbon spokes with a new and stronger construction.
Customers appreciated the way this recall was managed, which showed Mavic's
continuous commitment to maintaining its strong brand image. Improving the
supply chain and maintain tight control of expenses were key focus areas in
2009. Mavic's profitability weakened in 2009 due to lower sales volumes and the
disruption caused by the recall of R-Sys wheels.
On September 1, 2009, Amer Sports announced that it was exploring strategic
alternatives in respect of its cycling business and that the review could result
in the divestment of Mavic. Amer Sports evaluated several different options, and
reached the conclusion that the divestment of Mavic would not be in the best
interest of shareholders. Instead Amer Sports will concentrate its efforts on
further developing its cycling business.
Sports Instruments
Net sales of Sports Instruments' net sales fell by 5% in local currency terms to
EUR 85.8 million (89.8). Over the years, wristop computers and diving
instruments have consistently increased their share of Suunto's total net sales:
reaching 80% of total business in 2009. Net sales of wristop computers increased
in local currency terms by 3% and diving instruments fell by 13%. The
distribution of net sales by geographical region was as follows: EMEA 56%, the
Americas 29%, and Asia Pacific 15%. Suunto's profitability weakened in 2009.
In 2009, Suunto entered the premium sports watch market with the Suunto
Elementum collection.
Winter and Outdoor outlook 2010
The Winter and Outdoor segment is well positioned to continue to improve its
profitability. The Apparel and Footwear business area continues to extend its
direct-to-consumer program and its profitability is expected to remain at a good
level. Within Winter Sports Equipment, Cycling and Sports Instruments the focus
is on improving gross margins while maintaining tight cost control.
BALL SPORTS
+-----------------+------+------+------+------+-----+-----+------+------+
| |10-12/|10-12/|Change|Change| | |Change|Change|
| | | | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008| %| %*)|
+-----------------+------+------+------+------+-----+-----+------+------+
|Net sales | | | | | | | | |
+-----------------+------+------+------+------+-----+-----+------+------+
|Racquet Sports | 40.9| 45.1| -9| -5|222.7|227.0| -2| -5|
+-----------------+------+------+------+------+-----+-----+------+------+
|Team Sports | 43.6| 52.8| -17| -8|187.3|189.9| -1| -6|
+-----------------+------+------+------+------+-----+-----+------+------+
|Golf | 10.2| 12.1| -16| -13| 66.7| 78.6| -15| -16|
+-----------------+------+------+------+------+-----+-----+------+------+
|Net sales, total | 94.7| 110.0| -14| -8|476.7|495.5| -4| -7|
+-----------------+------+------+------+------+-----+-----+------+------+
|EBIT | 2.2| 3.4| -35| -28| 23.5| 37.0| -36| -40|
+-----------------+------+------+------+------+-----+-----+------+------+
|Personnel, Dec 31| | | | |1,586|1,731| -8| |
+-----------------+------+------+------+------+-----+-----+------+------+
*) In local currency terms
In 2009, Ball Sports net sales of EUR 476.7 million (495.5) fell by 7% in local
currencies. The breakdown of net sales by business area was as follows: Racquet
Sports 47%, Team Sports 39%, and Golf 14%. The Americas generated 63% of net
sales, EMEA 23%, and Asia Pacific 14%.
+------------+------+------+------+------+-----+-----+------+------+
| |10-12/|10-12/|Change|Change| | |Change|Change|
| | | | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008| %| %*)|
+------------+------+------+------+------+-----+-----+------+------+
|Americas | 61.7| 74.9| -18| -9|298.7|316.9| -6| -10|
+------------+------+------+------+------+-----+-----+------+------+
|EMEA | 18.0| 19.2| -6| -4|111.5|119.1| -6| -4|
+------------+------+------+------+------+-----+-----+------+------+
|Asia Pacific| 15.0| 15.9| -6| -6| 66.5| 59.5| 12| 4|
+------------+------+------+------+------+-----+-----+------+------+
|Total | 94.7| 110.0| -14| -8|476.7|495.5| -4| -7|
+------------+------+------+------+------+-----+-----+------+------+
*) In local currency terms
The EBIT of EUR 23.5 million (37.0), fell by 40% in local currency terms. The
lower EBIT was the result of revenue declines and lower margins driven by the
recessionary environment. The Americas and the Golf business area were impacted
in particular. The 2009 revenue declines were also affected by the inventory
destocking trend in retail. In October-December EBIT was 2.2 million (3.4) and
close to the previous year's level.
Racquet Sports
In local currencies, Racquet Sports' net sales fell in local currency terms by
5% to EUR 222.7 million (227.0). The breakdown of Racquet Sports sales by region
was as follows: the Americas 42%, EMEA 36% and Asia Pacific 22%. In local
currencies, the Americas saw a fall of 12%, EMEA fell by 2% whereas Asia Pacific
grew by 6%. The decline in the Americas was driven by the poor economic
environment. The growth in Asia Pacific reflects a positive development in both
Australia and Korea combined with the expanded distribution in China. Racquet
Sports' profitability remained at a good level.
For 2009, market trends remained stable for Racquet Sports. Wilson's position as
the leading tennis racket brand strengthened further. Its strong racket brand
position was leveraged to drive growth in tennis strings and accessories. The
biggest product categories were tennis rackets, representing 40% of net sales,
and tennis balls 22%. Net sales of tennis rackets fell in local currency terms
by 9%, and tennis balls were at least year's level.
Shipments of the new BLX racket line started in January 2010. Roger Federer,
Juan Martin Del Potro, and Justine Henin debuted successfully the new technology
at the 2010 Australian Open.
Team Sports
In local currencies, Team Sports' net sales fell in local currency terms by 6%
to EUR 187.3 million (189.9). The breakdown of Team Sports sales by region is as
follows: the Americas 94%, EMEA 2% and Asia Pacific 4%. In local currencies, the
Americas fell by 6%, the EMEA fell by 19% and Asia grew by 25%. Team Sports'
profitability weakened due to revenue declines and lower margins driven by the
recessionary environment.
The business environment in the Americas remained challenging due to the
economic environment and the inventory destocking trend by the trade. The growth
in Asia Pacific was driven by Korea, where the baseball strategies have been
successful. The biggest product categories were American footballs, representing
21% of net sales, baseballs and gloves with 20%, baseball and softball bats with
17%, and basketballs with 15%. Net sales of American footballs fell in local
currency terms by 10%, baseballs and gloves increased by 2%, baseball/softball
bats were at last year's level, and basketballs fell by 4%.
Golf
In local currencies, Golf's net sales fell in local currency terms by 16% to EUR
66.7 million (78.6). The breakdown of sales by market was: the Americas 44%,
EMEA 44% and Asia Pacific 12%. In local currencies, the Americas fell by 25%,
the EMEA fell by 4%, and Asia Pacific fell by 19%. The biggest product
categories were clubs, representing 59% of net sales, and balls 26%. Net sales
of clubs fell in local currencies by 15%, and balls by 21%.
The golf equipment market remained very competitive. The overall market decline
created a challenge for brands and retailers alike. Wilson Golf's profitability
was affected by the challenging market environment.
Wilson Golf's strategy is to focus on the iron category and the brand is
committed to making the best irons in the industry. Several new award-winning
products have been launched in 2010.
Ball Sports outlook 2010
A slight recovery is expected in the Ball Sports segment, driven by retail
distribution gains and assumed restocking due to low trade inventory levels.
Ball Sports' profitability is expected to improve mainly due to gross margin
improvements and tight cost control.
FITNESS
+-----------------+------+------+------+------+-----+-----+------+------+
| |10-12/|10-12/|Change|Change| | |Change|Change|
| | | | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008| %| %*)|
+-----------------+------+------+------+------+-----+-----+------+------+
|Net sales | 58.9| 58.7| 0| 10|194.1|220.3| -12| -15|
+-----------------+------+------+------+------+-----+-----+------+------+
|EBIT | -0.5| -2.3| | | -7.5| 3.8| | |
+-----------------+------+------+------+------+-----+-----+------+------+
|Personnel, Dec 31| | | | | 737| 765| -4| |
+-----------------+------+------+------+------+-----+-----+------+------+
*) In local currency terms.
In 2009, Fitness' net sales fell by 15% in local currencies to EUR 194.1 million
(220.3). The Americas accounted for 72% of net sales, EMEA for 20%, and Asia
Pacific for 8%.
+------------+------+------+------+------+-----+-----+------+------+
| |10-12/|10-12/|Change|Change| | |Change|Change|
| | | | | | | | | |
|EUR million | 2009| 2008| %| %*)| 2009| 2008| %| %*)|
+------------+------+------+------+------+-----+-----+------+------+
|Americas | 42.3| 43.6| -3| 8|140.7|158.8| -11| -15|
+------------+------+------+------+------+-----+-----+------+------+
|EMEA | 11.9| 11.2| 6| 11| 38.1| 45.4| -16| -11|
+------------+------+------+------+------+-----+-----+------+------+
|Asia Pacific| 4.7| 3.9| 21| 30| 15.3| 16.1| -5| -19|
+------------+------+------+------+------+-----+-----+------+------+
|Total | 58.9| 58.7| 0| 10|194.1|220.3| -12| -15|
+------------+------+------+------+------+-----+-----+------+------+
*) In local currency terms
EBIT fell to EUR -7.5 million (3.8) due to the sharp fall in sales, which could
not be fully offset by the cost reduction programs. In October-December, EBIT
was -0.5 million (-2.3), including bad debt provisions of EUR 5 million.
Fitness equipment manufacturers worldwide experienced significant reductions in
sales in both the commercial and consumer markets during 2009. Of Precor's net
sales, clubs and institutions represented 87% and home use was 13%.
The commercial business (clubs and institutions) fell by 14% in local
currencies. A dependable driver of commercial equipment sales growth had been
the opening of new facilities. With tightened credit markets and uncertain
consumer spending, most fitness customers held off on expansion plans in 2009.
Within existing facilities, a reduction in customer spending on extras such as
personal training and pro-shop gear led to lower revenues, which in turn drove
owners to cut expenses. Many chose to address expense cuts by deferring plans
for new fitness equipment, preferring to stretch the service life of their
existing equipment. In the fourth quarter of 2009, commercial business saw a
slight improvement as club operators increased their investments in new and
replacement equipment.
The consumer (home use) business fell by 19% in local currencies. The market for
consumer equipment experienced a second year of decline with the premium
segment, where Precor competes particularly, exposed to the broader trend of
reduced discretionary spending. Financial weakness among specialty fitness
dealers, the primary distribution channel for premium home equipment, magnified
market challenges.
Related to the construction of the new strength equipment production facility in
North Carolina, Precor has had significant capital expenditures in 2009. The
total amount is approximately EUR 4.5 million. The facility is now in use and
will provide the required capacity for the recently launched selectorized
strength lines and reduce manufacturing costs.
Fitness outlook 2010
In the near-term the outlook for the industry is uncertain. However, as 2009
progressed sales became more predictable and, in the fourth quarter, Precor
returned to growth. Precor has strengthened its position during the downturn by
continuing market penetration of the AMT®, successfully launching two new lines
of strength equipment, and winning key international hospitality accounts.
Precor is well positioned when demand returns in the fitness industry.
PERSONNEL
At the end of December, the Group employed 6,331 people (6,338). The Group
employed an average of 6,362 people (6,285) during the review period.
+------------------+------------+------------+------+
| |December 31,|December 31,|Change|
| | | | |
| | 2009| 2008| %|
+------------------+------------+------------+------+
|Winter and Outdoor| 3,940| 3,777| 4|
+------------------+------------+------------+------+
|Ball Sports | 1,586| 1,731| -8|
+------------------+------------+------------+------+
|Fitness | 737| 765| -4|
+------------------+------------+------------+------+
|Headquarters | 68| 65| 5|
+------------------+------------+------------+------+
|Total | 6,331| 6,338| 0|
+------------------+------------+------------+------+
+------------+------------+------------+------+
| |December 31,|December 31,|Change|
| | | | |
| | 2009| 2008| %|
+------------+------------+------------+------+
|EMEA | 3,590| 3,428| 5|
+------------+------------+------------+------+
|Americas | 2,195| 2,337| -6|
+------------+------------+------------+------+
|Asia Pacific| 546| 573| -5|
+------------+------------+------------+------+
|Total | 6,331| 6,338| 0|
+------------+------------+------------+------+
BOARD OF DIRECTORS AND MANAGEMENT OF THE COMPANY
Amer Sports Corporation reorganized its management model in 2009 by creating a
single group-wide Amer Sports management team. The purpose of the new Executive
Board is to strengthen the development and consistent execution of Amer Sports'
corporate strategy across all business areas and regions, driving Group
integration, common goals, and the Group's overall performance.
In 2009, the following new members were appointed to the Executive Board:
Jean-Marc Pambet, President of Apparel and Footwear, Bernard Millaud, President
of Cycling; Terhi Heikkinen, Senior Vice President Human Resources; and Antti
Jääskeläinen, Chief Development Officer. Due to the change, the Amer Sports
Executive Team ceased to exist.
On December 22, 2009, Amer Sports Board of Directors appointed Mr. Heikki Takala
(MSc) as Amer Sports' President and CEO effective from April 1, 2010. Roger
Talermo will continue in a special role assigned by Amer Sports Board of
Directors until the June 21, 2010, after which he will resign from the company.
Pekka Paalanne, Executive Vice President and Deputy to the President and CEO was
appointed as acting President and CEO from December 22, 2009, until March
31, 2010.
Amer Sports Executive Board members as of December 31, 2009:
- Pekka Paalanne, Acting President and CEO (December 22, 2009-March 31, 2010)
- Thomas Ehrnrooth, Senior Vice President Sales and Channel Management
- Vincent Wauters, Senior Vice President Supply Chain and Information Technology
- Terhi Heikkinen, Senior Vice President Human Resources
- Antti Jääskeläinen, Chief Development Officer
- Chris Considine, President of Ball Sports
- Paul Byrne, President of Fitness Equipment
- Juha Pinomaa, President of Sports Instruments
- Michael Schineis, President of Winter Sports Equipment
- Jean-Marc Pambet, President of Apparel and Footwear
- Bernard Millaud, President of Cycling
Amer Sports' Executive Board members are presented in more detail at
www.amersports.com/about <http://www.amersports.com/about>.
CORPORATE GOVERNANCE STATEMENT
Amer Sports has issued its Corporate Governance statement as a separate report.
Amer Sports' auditors have checked that the statement has been issued and that
the description of the main features of the internal control and risk management
systems in relation to the financial reporting process is consistent with Amer
Sports' financial statements. The Corporate Governance Code is publicly
available on Amer Sports' website www.amersports.com<http://www.amersports.com/>, in the Corporate governance section.
SHARES AND SHAREHOLDERS
The company's paid-up share capital recorded in the Trade Register as of
December 31, 2009 was EUR 292,182,204. On December 31, 2009, the company had a
market capitalization of EUR 848.3 million (389.7), excluding own shares.
On October 23, 2009 the final outcome of Amer Sports' rights offering showed
that 48,070,466 million shares, representing 99.2% of the total number of shares
offered, were subscribed for with subscription rights. The remaining 401,268
shares were subscribed for without subscription rights. As a result of the
rights offering, the number of Amer Sports' shares increased on October
26, 2009, by 48,471,734 shares to 121,517,285 shares.
Amer Sports' rights offering
A total of 48,471,734 new shares were subscribed for in Amer Sports' rights
offering. The subscription period for the offering ended on October 19, 2009.
All the new shares were registered with the Trade Register on October 26, 2009.
Following the registration, the total number of Amer Sports' shares is
121,517,285 shares. The new shares include the right to dividends and other
distributions as well as other shareholder rights, effective from the
registration date of October 26, 2009.
The highest price of the subscription rights on the OMX Helsinki Stock Exchange
was EUR 2.15, and the lowest EUR 1.23, and the last trading price was EUR 2.11.
In 2009, a total of 8.6 million were traded at a total price of EUR 13.1
million.
Trading in shares
Over the course of the period, a total of 71.0 million (101.3) Amer Sports
shares were traded on the NASDAQ OMX Helsinki exchange, to a total value of EUR
458.3 million (1,172.5). The share turnover was 76.4% (139.6) (of the average
number of shares, excluding own shares).
At the close of the review period, the last trading in Amer Sports Corporation
shares was at EUR 7.00. The high for the period on the NASDAQ OMX Helsinki
exchange was EUR 7.19, and the low EUR 3.67. The average share price was EUR
6.45.
Major shareholders, December 31, 2009 (includes no nominee registrations)
+--+------------------------------------------+---------+-----------+
| | | |% of shares|
| | | | |
| | | Shares| and votes|
+--+------------------------------------------+---------+-----------+
|1 |Maa- ja Vesitekniikan Tuki ry. |5,000,000| 4.1|
+--+------------------------------------------+---------+-----------+
|2 |Varma Mutual Pension Insurance Company |4,770,210| 3.9|
+--+------------------------------------------+---------+-----------+
|3 |Ilmarinen Mutual Pension Insurance Company|4,191,668| 3.4|
+--+------------------------------------------+---------+-----------+
|4 |Brotherus Ilkka |2,681,179| 2.2|
+--+------------------------------------------+---------+-----------+
|5 |The State Pension Fund |1,937,556| 1.6|
+--+------------------------------------------+---------+-----------+
|6 |Odin Norden |1,684,832| 1.4|
+--+------------------------------------------+---------+-----------+
|7 |Tapiola Mutual Pension Insurance Company |1,614,500| 1.3|
+--+------------------------------------------+---------+-----------+
|8 |Mandatum Life Insurance Company |1,609,680| 1.3|
+--+------------------------------------------+---------+-----------+
|9 |Odin Finland |1,090,888| 0.9|
+--+------------------------------------------+---------+-----------+
|10|OP-Finland Value Fund |1,025,000| 0.8|
+--+------------------------------------------+---------+-----------+
At the end of December, Amer Sports had 13,342 registered shareholders (12,320).
Outside Finland, ownership and nominee registrations represented 52.6% (45.2%)
of the shares. Public sector entities owned 12.5%, households 12.4%, financial
and insurance corporations 11.7%, non-profit institutions 8.2%, and private
companies 2.3%. Amer Sports had 334,900 own shares, which are owned by Amer
Sports International Oy. The number of own shares corresponds to 0.3% of all
Amer Sports shares.
Major changes in holdings
Amer Sports Corporation received information on February 19, 2009, to the effect
that Novator Finland Oy 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.
On July 2, 2009, Amer Sports Corporation was notified that Novator Finland Oy
had sold its entire holding of shares in the company.
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 in
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 no
shares in Amer Sports Corporation.
The stock exchange announcements on major changes in shareholdings in 2009 can
be found on the Amer Sports Web pages at www.amersports.com/investors<http://www.amersports.com/investors>.
Disclosure of control
Amer Sports' Board of Directors is not aware of any natural or legal persons who
have control over the company or has information on these persons' portion of
the voting rights of the shares and of the total number of shares.
Agreements and arrangements relating to shareholdings and use of voting rights
Amer Sports' Board of Directors is not aware of any agreements or arrangements
concerning the ownership of the company's shares and the use of their voting
rights.
Shareholdings of the management and administrative bodies, December 31, 2009
+----------------------------------+---------+---------------------------------+
|Shareholder | Shares| Circle of acquaintances and|
| | | controlled corporations|
+----------------------------------+---------+---------------------------------+
|Board of Directors | | |
+----------------------------------+---------+---------------------------------+
|Anssi Vanjoki | 23,416| |
+----------------------------------+---------+---------------------------------+
|Ilkka Brotherus |2,681,179| 10,250|
+----------------------------------+---------+---------------------------------+
|Martin Burkhalter | 5,091| |
+----------------------------------+---------+---------------------------------+
|Christian Fischer | 5,091| |
+----------------------------------+---------+---------------------------------+
|Hannu Ryöppönen | 3,375| 14,175|
+----------------------------------+---------+---------------------------------+
|Bruno Sälzer | 5,091| |
+----------------------------------+---------+---------------------------------+
|Pirjo Väliaho | 7,302| |
+----------------------------------+---------+---------------------------------+
|Executive Board | | |
+----------------------------------+---------+---------------------------------+
|Pekka Paalanne | 52,000| |
+----------------------------------+---------+---------------------------------+
|Paul Byrne | 0| |
+----------------------------------+---------+---------------------------------+
|Chris Considine | 7,150| |
+----------------------------------+---------+---------------------------------+
|Thomas Ehrnrooth | 22,500| |
+----------------------------------+---------+---------------------------------+
|Terhi Heikkinen | 0| |
+----------------------------------+---------+---------------------------------+
|Antti Jääskeläinen | 0| |
+----------------------------------+---------+---------------------------------+
|Bernard Millaud | 6,875| |
+----------------------------------+---------+---------------------------------+
|Jean-Marc Pambet | 6,875| |
+----------------------------------+---------+---------------------------------+
|Juha Pinomaa | 5,850| 15|
+----------------------------------+---------+---------------------------------+
|Michael Schineis | 10,000| |
+----------------------------------+---------+---------------------------------+
|Vincent Wauters | 24,491| |
+----------------------------------+---------+---------------------------------+
|TOTAL |2,866,286| |
+----------------------------------+---------+---------------------------------+
|% of shares | 2.36| |
+----------------------------------+---------+---------------------------------+
+----------------------------------+---------+---------------------------------+
|Including circle of acquaintances |2,890,726| |
|and controlled corporations | | |
+----------------------------------+---------+---------------------------------+
|% of shares | 2.38| 24,440|
+----------------------------------+---------+---------------------------------+
Exercise of warrants
The highest price of the 2004 warrants on the OMX Helsinki Stock Exchange was
EUR 1.30, and the lowest EUR 0.11. In 2009, a total of 5,700 warrants were
traded at a total price of EUR 4,609.
Amendments to the terms and conditions of the warrant programs
Pursuant to the terms and conditions of Amer Sports' warrant programs, Amer
Sports' Board of Directors must amend the terms and conditions of the warrant
programs to take into account the impact of the rights offering by adjusting the
exercise price of the warrants and/or the number of shares that can be
subscribed for through exercise of the warrants in a manner to be determined by
the Board of Directors. On October 29, 2009, Amer Sports' Board of Directors
decided on such amendments. The terms and conditions of its publicly traded
2004 warrants were amended to the effect that each 2004 warrant entitles its
holder to subscribe for five shares at the subscription price of EUR 9.44 per
share.
RESOLUTIONS OF THE GENERAL MEETINGS OF SHAREHOLDERS
Amer Sports' Annual General Meeting of shareholders, which was held on March
5, 2009, authorized the Board of Directors to decide on issuing new shares on
the following terms and conditions: New shares may be issued and the company's
own shares held by the company may be conveyed against payment ("Share Issue
Against Payment") to the company's shareholders in proportion to their current
shareholdings in the company. By virtue of the authorization, the Board of
Directors is entitled to decide on issuing a maximum of 7,000,000 new shares.
The subscription price of the new shares shall be booked to the invested
non-restricted equity fund. The authorization to issue shares is valid for two
years from the date of the decision of the Annual General Meeting.
On March 5, 2009, the Annual General Meeting re-elected Anssi Vanjoki, Ilkka
Brotherus, Pirjo Väliaho, Martin Burkhalter, Christian Fischer, and Bruno Sälzer
as members of the Board of Directors, and appointed Hannu Ryöppönen as a new
board member. The Board's term of service will run until the close of the 2010
Annual General Meeting. The Authorized Public Accountant PricewaterhouseCoopers
Oy was elected to act as the company's auditor. Jouko Malinen, Authorized Public
Accountant, was elected as the auditor in charge of the audit.
Extraordinary General meeting, September 23, 2009
The Extraordinary General Meeting of Amer Sports' shareholders held on September
23, 2009, authorized the Board of Directors to undertake a share issue for
consideration in which the shareholders were entitled to subscribe for new
shares in proportion to their existing shareholdings. The Board of Directors was
authorized to decide upon offering any shares that may remain unsubscribed for
pursuant to the shareholders' pre-emptive rights to parties determined by the
Board of Directors. By virtue of the authorization, the Board of Directors was
entitled to decide on issuing a maximum of 150,000,000 new shares in the share
issue. The Board of Directors was authorized to determine the other terms and
conditions of the share issue. The authorization of the Board of Directors to
undertake the share issue did not supersede or otherwise invalidate the share
issue authorization granted to the Board of Directors by the Annual General
Meeting on March 5, 2009.
Authorization to repurchase or convey own shares
Amer Sports did not acquire any its own shares during 2009. Amer Sports' Board
of Directors does not have a valid authorization to acquire or dispose of Amer
Sports' own shares.
The documentation and press releases related to the meetings are available on
the company's website, at www.amersports.com <http://www.amersports.com/>.
SIGNIFICANT RISKS AND UNCERTAINTIES
Amer Sports' business is balanced by its broad portfolio of sports and brands as
well as its presence in all major markets. Amer Sports Corporation's short-term
risks are particularly associated with consumer demand in North America and
Europe and successful execution of its cost reduction and efficiency improvement
measures.
For example, the following risks can potentially have an impact on the company's
development:
* The United States represents 40% of the world-wide sporting goods market and
approximately 40% of Amer Sports' sales. There is a correlation between the
demand for sporting goods and the development of US retail sales. Therefore,
a change in overall US retail sales can have an impact on Amer Sports'
business.
* Winter sports equipment represents 24% of Amer Sports' sales. Weather
conditions can have an impact on the company's results. Historically,
however, poor snow conditions in one region are compensated for by good snow
conditions in another region.
* A change in the euro's value vis-à-vis other currencies has an impact on
Amer Sports' results. The impact, however, is limited due to the fact that
the company's euro-US dollar position is relatively balanced.
* Despite extensive testing of its products before market launch, the company
cannot completely rule out the risk of product recalls and legal actions
related to product liability. Amer Sports has standard insurance cover
against the financial consequences of product recalls and product liability
cases. Product quality issues could harm Amer Sports' reputation and, as a
result, could have an adverse effect on its sales.
* Losing a significant client would affect Amer Sports' sales. However, this
risk is limited because Amer Sports' client base is diversified, with the
five largest clients accounting for less than 10% of the company's annual
sales.
* Amer Sports uses steel, rubber, and oil-based raw materials and components
in its products. Price increases affecting these materials can have a
negative impact on product costs. Amer Sports typically introduces new
products every year, which can, depending on the market situation, offset
the impact of material cost increases.
* A large part of Amer Sports' production is outsourced. The aim is to
minimize the supply, quality, and price risks associated with purchasing.
Although the business areas audit their subcontractors regularly, possible
delivery problems or breaches of contract by subcontractors may have an
impact on Amer Sports' operations.
* Amer Sports' most important production facilities are the Winter Sports
Equipment factories in Austria and Bulgaria, Precor's factory in the United
States, and the Suunto factory in Finland. In addition, Amer Sports has
major factories in Eastern Europe, which are owned by subcontractors. Amer
Sports' most important distribution centers are located in Germany, Austria,
the United States, and France. Any unexpected production or delivery breaks
in these units would have a negative impact on the company's business.
* A characteristic feature of the sporting goods industry is the need to
protect intellectual property rights and disputes connected with them. The
material impacts on Amer Sports' financial position and operational result
arising from pending litigation affecting the business areas and decisions
of the authorities are assessed regularly, and current estimates are
presented publicly when necessary.
* Amer Sports has goodwill and intangible assets with the indefinite lifetime
of EUR 453 million on its balance sheet, as at December 31, 2009, which is
62% of the company's net equity. The valuation of goodwill and intangible
assets on Amer Sports' consolidated balance sheet is, to a significant
degree, dependent on management estimates of the future cash generation
capacity of the relevant assets or cash generating units. Management reviews
the carrying amounts of its goodwill and intangible assets annually to
determine whether there is any indication of impairment. The company
undertook goodwill and intangible asset impairment testing during the fourth
quarter of 2009 and did not indicate any impairment in its 2009 financial
statements.
* Amer Sports sources a significant portion of its products from
subcontractors located throughout Asia, which exposes it to the political,
economic, and regulatory conditions in that area, and to a variety of local
business and labor practice issues. The violation of labor laws, regulations
or standards by Amer Sports' subcontractors, or the divergence of those
subcontractors' labor practices from those generally accepted as ethical in
the European Union or the international community, could have a material
adverse effect on Amer Sports' public image and the reputation of its
brands.
* Amer Sports relies on data communications to operate its business, and it is
in the process of integrating its IT platform globally and implementing
further applications to better control its supply chain. System failures and
service interruptions may occur as the result of a number of factors. Any of
these factors could have a material adverse affect on Amer Sports' business.
OUTLOOK FOR 2010
Amer Sports does not anticipate a quick recovery in the sporting goods market,
and therefore the company's key priority is to improve its profitability through
gross margin improvements and continued tight cost control. The company will
also continue to focus on strict working capital management, although an
improvement similar to the previous year cannot be expected. Capital
expenditures and other investments will remain at the previous year's level. The
company's tax rate is expected to be approximately 20%.
DIVIDEND POLICY
Amer Sports wishes to be seen as a competitive investment that increases
shareholder value through a combination of dividends and share price
performance. The company therefore pursues a progressive dividend policy
reflecting its results, with the objective of distributing a dividend of at
least one-third of annual net profits.
BOARD OF DIRECTORS' PROPOSAL FOR DISTRIBUTION OF EARNINGS
The parent company's unrestricted shareholders' equity amounts to EUR
407,895,630.60, of which the net result for the period is EUR -27,979,155.99.
The Board of Directors proposes to the Annual General Meeting that the
distributable earnings be used as follows:
- A dividend of EUR 0.16 per share, totaling EUR 19,442,765.60 to be paid to
shareholders
- EUR 388,452,865.00 to be carried forward in unrestricted shareholders' equity
Totaling EUR 407,895,630.60
No dividend will be paid for own shares held by the company.
There have been no significant changes to the company's financial position since
the close of the financial period. According to the Board of Directors, the
proposed dividend distribution does not endanger the company's financial
standing.
TABLES
The figures presented in this stock exchange release are based on the Group's
audited financial statements, and it has been prepared in accordance with the
International Financial Reporting Standards (IFRS) as adopted by the EU. The
notes are an integral part of consolidated financial information.
EUR million
CONSOLIDATED RESULTS
+----------------------------------+-------+-------+------+------+------+------+
| | 1-12/| 1-12/|Change|10-12/|10-12/|Change|
| | | | | | | |
| | 2009| 2008| %| 2009| 2008| %|
+----------------------------------+-------+-------+------+------+------+------+
|NET SALES |1,533.4|1,576.6| -3| 482.8| 495.3| -3|
+----------------------------------+-------+-------+------+------+------+------+
|Cost of goods sold | -913.4| -943.6| |-286.3|-311.0| |
+----------------------------------+-------+-------+------+------+------+------+
|GROSS PROFIT | 620.0| 633.0| -2| 196.5| 184.3| 7|
+----------------------------------+-------+-------+------+------+------+------+
|License income | 8.2| 14.3| | 1.6| 4.1| |
+----------------------------------+-------+-------+------+------+------+------+
|Other operating income | 4.6| 18.9| | -0.3| 3.2| |
+----------------------------------+-------+-------+------+------+------+------+
|R&D expenses | -52.0| -55.6| | -14.1| -16.0| |
+----------------------------------+-------+-------+------+------+------+------+
|Selling and marketing expenses | -398.6| -406.2| |-111.2|-112.6| |
+----------------------------------+-------+-------+------+------+------+------+
|Administrative and other | | | | | | |
| | -138.4| -125.5| | -33.1| -27.8| |
|expenses | | | | | | |
+----------------------------------+-------+-------+------+------+------+------+
|EARNINGS BEFORE | | | | | | |
| | 43.8| 78.9| -44| 39.4| 35.2| 12|
|INTEREST AND TAXES | | | | | | |
+----------------------------------+-------+-------+------+------+------+------+
|% of net sales | 2.9| 5.0| | 8.2| 7.1| |
+----------------------------------+-------+-------+------+------+------+------+
|Financing income and expenses | -18.4| -33.3| | -7.1| -11.3| |
+----------------------------------+-------+-------+------+------+------+------+
|EARNINGS BEFORE TAXES | 25.4| 45.6| -44| 32.3| 23.9| 35|
+----------------------------------+-------+-------+------+------+------+------+
|Taxes | 6.0| -11.6| | 4.3| -6.2| |
+----------------------------------+-------+-------+------+------+------+------+
|NET RESULT | 31.4| 34.0| -8| 36.6| 17.7| |
+----------------------------------+-------+-------+------+------+------+------+
+----------------------------------+-------+-------+------+------+------+------+
|Attributable to: | | | | | | |
+----------------------------------+-------+-------+------+------+------+------+
|Equity holders of the parent | | | | | | |
| | 31.3| 33.9| | 36.6| 17.7| |
|company | | | | | | |
+----------------------------------+-------+-------+------+------+------+------+
|Minority interests | 0.1| 0.1| | 0.0| 0.0| |
+----------------------------------+-------+-------+------+------+------+------+
+----------------------------------+-------+-------+------+------+------+------+
|Earnings per share, EUR | 0.28| 0.37| | 0.37| 0.20| |
+----------------------------------+-------+-------+------+------+------+------+
|Earnings per share, diluted, EUR | 0.28| 0.37| | 0.37| 0.20| |
+----------------------------------+-------+-------+------+------+------+------+
+----------------------------------+-------+-------+------+------+------+------+
|Adjusted average number of | | | | | | |
| | 97.7| 92.7| | | | |
|shares in issue less own shares, | | | | | | |
|million | | | | | | |
+----------------------------------+-------+-------+------+------+------+------+
|Adjusted average number of | | | | | | |
| | | | | | | |
|shares in issue less own shares, | 97.7| 92.7| | | | |
| | | | | | | |
|diluted, million | | | | | | |
+----------------------------------+-------+-------+------+------+------+------+
+----------------------------------+-------+-------+------+------+------+------+
|Equity per share, EUR | 6.05| 5.44| | | | |
+----------------------------------+-------+-------+------+------+------+------+
|ROCE, % *) | 4.3| 7.9| | | | |
+----------------------------------+-------+-------+------+------+------+------+
|ROE, % | 5.0| 6.7| | | | |
+----------------------------------+-------+-------+------+------+------+------+
|Average rates used: | | | | | | |
| | 1.47| 1.47| | | | |
|EUR 1.00 = USD | | | | | | |
+----------------------------------+-------+-------+------+------+------+------+
*) 12 months' rolling average
Share-based key indicators have been adjusted for the impact of the share issue
in 2009.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
+-------------------------------------------+-----+-----+------+------+
| |1-12/|1-12/|10-12/|10-12/|
| | | | | |
| | 2009| 2008| 2009| 2008|
+-------------------------------------------+-----+-----+------+------+
|Net result | 31.4| 34.0| 36.6| 17.7|
+-------------------------------------------+-----+-----+------+------+
+-------------------------------------------+-----+-----+------+------+
|Other comprehensive income | | | | |
+-------------------------------------------+-----+-----+------+------+
|Translation differences | -0.5| 4.3| 5.8| 8.3|
+-------------------------------------------+-----+-----+------+------+
|Cash flow hedges | 1.1| -4.7| 1.7| -8.7|
+-------------------------------------------+-----+-----+------+------+
|Income tax related to | | | | |
| | | | | |
|cash flow hedges | | | | |
+-------------------------------------------+-----+-----+------+------+
| | -0.3| 1.2| -0.5| 2.2|
+-------------------------------------------+-----+-----+------+------+
|Other comprehensive income, | | | | |
| | | 0.8| | |
|net of tax | 0.3| | 7.0| 1.8|
+-------------------------------------------+-----+-----+------+------+
|Total comprehensive income | 31.7| 34.8| 43.6| 19.5|
+-------------------------------------------+-----+-----+------+------+
+-------------------------------------------+-----+-----+------+------+
|Total comprehensive income attributable to:| | | | |
+-------------------------------------------+-----+-----+------+------+
|Equity holders of the parent | | | | |
| | 31.6| 34.7| 43.6| 19.5|
|company | | | | |
+-------------------------------------------+-----+-----+------+------+
|Minority interests | 0.1| 0.1| 0.0| 0.0|
+-------------------------------------------+-----++----+------+------+
+--------------------------------------------------+------------------+
NET SALES BY BUSINESS SEGMENT
+------------------+-------+-------+------+------+------+------+
| | 1-12/| 1-12/|Change|10-12/|10-12/|Change|
| | | | | | | |
| | 2009| 2008| %| 2009| 2008| %|
+------------------+-------+-------+------+------+------+------+
|Winter and Outdoor| 862.6| 860.8| 0| 329.2| 326.6| 1|
+------------------+-------+-------+------+------+------+------+
|Ball Sports | 476.7| 495.5| -4| 94.7| 110.0| -14|
+------------------+-------+-------+------+------+------+------+
|Fitness | 194.1| 220.3| -12| 58.9| 58.7| 0|
+------------------+-------+-------+------+------+------+------+
|Total |1,533.4|1,576.6| -3| 482.8| 495.3| -3|
+------------------+-------+-------+------+------+------+------+
EBIT BY BUSINESS SEGMENT
+------------------+-----+------+------+------+------+------+
| |1-12/| 1-12/|Change|10-12/|10-12/|Change|
| | | | | | | |
| | 2009| 2008| %| 2009| 2008| %|
+------------------+-----+------+------+------+------+------+
|Winter and Outdoor| 46.5| 41.1| 13| 42.5| 36.7| 16|
+------------------+-----+------+------+------+------+------+
|Ball Sports | 23.5| 37.0| -36| 2.2| 3.4| -35|
+------------------+-----+------+------+------+------+------+
|Fitness | -7.5| 3.8| | -0.5| -2.3| |
+------------------+-----+------+------+------+------+------+
|Headquarters |-18.7|-3.0*)| | -4.8| -2.6| |
+------------------+-----+------+------+------+------+------+
|Total | 43.8| 78.9| -44| 39.4| 35.2| 12|
+------------------+-----+------+------+------+------+------+
*) Including EUR 13 million capital gain
GEOGRAPHIC BREAKDOWN OF NET SALES
+------------+-------+-------+------+------+------+------+
| | 1-12/| 1-12/|Change|10-12/|10-12/|Change|
| | | | | | | |
| | 2009| 2008| %| 2009| 2008| %|
+------------+-------+-------+------+------+------+------+
|Americas | 620.5| 677.8| -8| 154.6| 178.8| -14|
+------------+-------+-------+------+------+------+------+
|EMEA | 735.0| 723.0| 2| 266.1| 249.5| 7|
+------------+-------+-------+------+------+------+------+
|Asia Pacific| 177.9| 175.8| 1| 62.1| 67.0| -7|
+------------+-------+-------+------+------+------+------+
|Total |1,533.4|1,576.6| -3| 482.8| 495.3| -3|
+------------+-------+-------+------+------+------+------+
CONSOLIDATED CASH FLOW STATEMENT
+--------------------------------------------+----+---------+---------+
| |Note|1-12/2009|1-12/2008|
+--------------------------------------------+----+---------+---------+
|EBIT | | 43.8| 78.9|
+--------------------------------------------+----+---------+---------+
|Adjustments to cash flow from operating | | | |
| | | | |
|activities and depreciation | | 34.6| 20.6|
+--------------------------------------------+----+---------+---------+
|Change in working capital | | 136.7| -42.6|
+--------------------------------------------+----+---------+---------+
|Cash flow from operating activities before | | | |
| | | | |
|financing items and taxes | | 215.1| 56.9|
+--------------------------------------------+----+---------+---------+
+--------------------------------------------+----+---------+---------+
|Interest paid and received | | -20.9| -31.9|
+--------------------------------------------+----+---------+---------+
|Income taxes paid | | -12.6| -14.5|
+--------------------------------------------+----+---------+---------+
|Net cash flow from operating activities | | 181.6| 10.5|
+--------------------------------------------+----+---------+---------+
+--------------------------------------------+----+---------+---------+
|Acquired operations | | -3.0| -2.5|
+--------------------------------------------+----+---------+---------+
|Company divestments | | -| 3.6|
+--------------------------------------------+----+---------+---------+
|Capital expenditure on non-current tangible | | | |
| | | | |
|and intangible assets | | -39.5| -43.1|
+--------------------------------------------+----+---------+---------+
|Proceeds from sale of tangible non-current | | | |
| | | | |
|assets | | 1.4| 27.4|
+--------------------------------------------+----+---------+---------+
|Net cash flow from investing activities | | -41.1| -14.6|
+--------------------------------------------+----+---------+---------+
+--------------------------------------------+----+---------+---------+
|Share issue, net | | 151.5| -|
+--------------------------------------------+----+---------+---------+
|Dividends paid | 5| -11.8| -36.4|
+--------------------------------------------+----+---------+---------+
|Hybrid bond | 3| 60.0| -|
+--------------------------------------------+----+---------+---------+
|Change in net debt and other financing items| 3| -290.9| 42.8|
+--------------------------------------------+----+---------+---------+
|Net cash flow from financing activities | | -91.2| 6.4|
+--------------------------------------------+----+---------+---------+
+--------------------------------------------+----+---------+---------+
|Cash and cash equivalents on January 1 | | 72.1| 68.0|
+--------------------------------------------+----+---------+---------+
|Translation differences | | 0.2| 1.8|
+--------------------------------------------+----+---------+---------+
|Change in cash and cash equivalents | | 49.3| 2.3|
+--------------------------------------------+----+---------+---------+
|Cash and cash equivalents on December 31 | | 121.6| 72.1|
+--------------------------------------------+----+---------+---------+
CONSOLIDATED BALANCE SHEET
+-------------------------------------+----+-----------------+-----------------+
| |Note|December 31, 2009|December 31, 2008|
+-------------------------------------+----+-----------------+-----------------+
|Assets | | | |
+-------------------------------------+----+-----------------+-----------------+
|Goodwill | | 273.6| 279.3|
+-------------------------------------+----+-----------------+-----------------+
|Other intangible non-current assets | | 210.1| 207.5|
+-------------------------------------+----+-----------------+-----------------+
|Tangible non-current assets | | 135.0| 135.3|
+-------------------------------------+----+-----------------+-----------------+
|Other non-current assets | | 74.3| 65.9|
+-------------------------------------+----+-----------------+-----------------+
|Inventories and work in progress | | 234.6| 346.0|
+-------------------------------------+----+-----------------+-----------------+
|Receivables | | 475.4| 555.8|
+-------------------------------------+----+-----------------+-----------------+
|Cash and cash equivalents | | 121.6| 72.1|
+-------------------------------------+----+-----------------+-----------------+
|Total assets | 2| 1,524.6| 1,661.9|
+-------------------------------------+----+-----------------+-----------------+
+-------------------------------------+----+-----------------+-----------------+
|Shareholders' equity and liabilities | | | |
+-------------------------------------+----+-----------------+-----------------+
|Shareholders' equity | 3| 735.3| 508.1|
+-------------------------------------+----+-----------------+-----------------+
|Long-term interest-bearing | 3| 282.8| |
|liabilities | | | 434.9|
+-------------------------------------+----+-----------------+-----------------+
|Other long-term liabilities | | 14.4| 22.0|
+-------------------------------------+----+-----------------+-----------------+
|Current interest-bearing liabilities | 3| 121.3| 252.8|
+-------------------------------------+----+-----------------+-----------------+
|Other current liabilities | | 340.0| 389.0|
+-------------------------------------+----+-----------------+-----------------+
|Provisions | | 30.8| 55.1|
+-------------------------------------+----+-----------------+-----------------+
|Total shareholders' equity and | | 1,524.6| |
|liabilities | | | 1,661.9|
+-------------------------------------+----+-----------------+-----------------+
+-------------------------------------+----+-----------------+-----------------+
|Equity ratio, % | | 48.2| 30.6|
+-------------------------------------+----+-----------------+-----------------+
|Gearing, % | | 38| 121|
+-------------------------------------+----+-----------------+-----------------+
|EUR 1.00 = USD | | 1.44| 1.39|
+-------------------------------------+----+-----------------+-----------------+
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
+------------+----+-----+----+----+------+------+-------+----+------+-----+
| | | | | | | | | | | |
| | | | | | | | In-| | | |
| | | | | | | | | | | |
| | | | | | | Fair| ves-| | | |
| | | | | | | | | | | |
| | | | |Fund|Trans-| value| ted| | | |
| | | | | | | | | | | |
| | | Sh-|Pre-| for|lation| and| unres-| |Retai-| |
| | | | | | | | | | | |
| | | are| mi-| own|diffe-| other|tricted|Hyb-| ned| |
| | | | | | | | | | | |
| | |capi-| um|sha-| ren-|reser-| equity| rid| ear-| |
| | | | | | | | | | | |
| |Note| tal|fund| res| ces| ves|reserve|bond| nings|Total|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Balance at | | | | | | | | | | |
| | | | | | | | | | | |
|Jan. 1, | | | | | | | | | | |
| | | | | | | | | | | |
|2008 | |289.3|15.0|-7.5| -66.8| -2.7| -| -| 278.9|506.2|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Total | | | | | | | | | | |
| | | | | | | | | | | |
|comp- | | | | | | | | | | |
| | | | | | | | | | | |
|rehensive | | | | | | | | | | |
| | | | | | | | | | | |
|income | | | | | 4.3| -3.5| | | 33.9| 34.7|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Dividend | | | | | | | | | | |
| | | | | | | | | | | |
|distribution| 5| | | | | | | | -36.3|-36.3|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Reissu- | | | | | | | | | | |
| | | | | | | | | | | |
|ance of | | | | | | | | | | |
| | | | | | | | | | | |
|own | | | | | | | | | | |
| | | | | | | | | | | |
|shares | | | | 1.8| | | | | | 1.8|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Share- | | | | | | | | | | |
| | | | | | | | | | | |
|based | | | | | | | | | | |
| | | | | | | | | | | |
|incentive | | | | | | | | | -0.9| -0.9|
| | | | | | | | | | | |
|plans | | | | | | | | | | |
| | | | | | | | | | | |
|expensed | | | | | | | | | | |
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Warrants | | | | | | | | | | |
| | | | | | | | | | | |
|exercised | | 2.9|-2.9| | | | | | | 0.0|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Balance at | | | | | | | | | | |
| | | | | | | | | | | |
|Dec. 31, | | | | | | | | | | |
| | | | | | | | | | | |
|2008 | |292.2|12.1|-5.7| -62.5| -6.2| -| -| 275.6|505.5|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Balance at | | | | | | | | | | |
| | | | | | | | | | | |
|Jan. 1, | | | | | | | | | | |
| | | | | | | | | | | |
|2009 | |292.2|12.1|-5.7| -62.5| -6.2| -| -| 275.6|505.5|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Total | | | | | | | | | | |
| | | | | | | | | | | |
|comp- | | | | | | | | | | |
| | | | | | | | | | | |
|rehensive | | | | | | | | | | |
| | | | | | | | | | | |
|income | | | | | -0.5| 0.8| | | 31.3| 31.6|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Share | | | | | | | | | | |
| | | | | | | | 151.5| | |151.5|
|Issue, net | | | | | | | | | | |
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Dividend | | | | | | | | | | |
| | | | | | | | | | | |
|distribution| 5| | | | | | | | -11.6|-11.6|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Reissu- | | | | | | | | | | |
| | | | | | | | | | | |
|ance of | | | | | | | | | | |
| | | | | | | | | | | |
|own | | | | | | | | | | |
| | | | | | | | | | | |
|shares | | | | 0.1| | | | | | 0.1|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Hybrid | | | | | | | | | | |
| | | | | | | | | | | |
|bond | 3| | | | | | |60.0| -4.4| 55.6|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
|Balance at | | | | | | | | | | |
| | | | | | | | | | | |
|Dec. 31, | | | | | | | | | | |
| | | | | | | | | | | |
|2009 | |292.2|12.1|-5.6| -63.0| -5.4| 151.5|60.0| 290.9|732.7|
+------------+----+-----+----+----+------+------+-------+----+------+-----+
+------------+----+-----+------+
| | | | Total|
| | | | |
| | |Mino-|share-|
| | | | |
| | | rity| hold-|
| |Note| | |
| | |inte-| ers'|
| | | | |
| | |rests| equ-|
| | | | |
| | | | ity|
+------------+----+-----+------+
|Balance at | | | |
| | | | |
|Jan. 1, | | | |
| | | | |
|2008 | | 3.5| 509.7|
+------------+----+-----+------+
|Total | | | |
| | | | |
|comp- | | | |
| | | | |
|rehensive | | | |
| | | | |
|income | | 0.1| 34.8|
+------------+----+-----+------+
|Dividend | | | |
| | 5| -0,1| -36.4|
|distribution| | | |
+------------+----+-----+------+
|Reissu- | | | |
| | | | |
|ance of | | | |
| | | | |
|own | | | |
| | | | |
|shares | | | 1.8|
+------------+----+-----+------+
|Warrants | | | |
| | | | |
|expensed | | | -0.9|
+------------+----+-----+------+
|Warrants | | | |
| | | | |
|exercised | | | 0.0|
+------------+----+-----+------+
|Other | | | |
| | | | |
|change in | | | |
| | | | |
|minority | | | |
| | | | |
|interests | | -0.9| -0.9|
+------------+----+-----+------+
|Balance at | | | |
| | | | |
|Dec. 31, | | | |
| | | | |
|2008 | | 2.6| 508.1|
+------------+----+-----+------+
+------------+----+-----+------+
|Balance at | | | |
| | | | |
|Jan. 1, | | | |
| | | | |
|2009 | | 2.6| 508.1|
+------------+----+-----+------+
|Total | | | |
| | | | |
|comp- | | | |
| | | | |
|rehensive | | | |
| | | | |
|income | | 0.1| 31.7|
+------------+----+-----+------+
|Share | | | |
| | | | 151.5|
|Issue, net | | | |
+------------+----+-----+------+
|Dividend | | | |
| | 5| -0.2| -11.8|
|distribution| | | |
+------------+----+-----+------+
|Reissu- | | | |
| | | | |
|ance of | | | |
| | | | 0.1|
|own | | | |
| | | | |
|shares | | | |
+------------+----+-----+------+
|Hybrid | | | |
| | 3| | 55.6|
|bond | | | |
+------------+----+-----+------+
|Other | | | |
| | | | |
|change in | | | |
| | | 0.1| 0.1|
|minority | | | |
| | | | |
|interests | | | |
+------------+----+-----+------+
|Balance at | | | |
| | | | |
|Dec. 31, | | | |
| | | | |
|2009 | | 2.6| 735.3|
+------------+----+-----+------+
QUARTERLY BREAKDOWN OF NET SALES AND EBIT
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
| | Q4/| Q3/| Q2/| Q1/| Q4/| Q3/| Q2/| Q1/|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|NET SALES | 2009| 2009| 2009| 2009| 2008| 2008| 2008| 2008|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Winter and Outdoor|329.2|262.4|106.6|164.4|326.6|267.6|104.6|162.0|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Ball Sports | 94.7|103.4|135.7|142.9|110.0|110.6|130.9|144.0|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Fitness | 58.9| 44.8| 42.4| 48.0| 58.7| 55.0| 49.6| 57.0|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Total |482.8|410.6|284.7|355.3|495.3|433.2|285.1|363.0|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
| | Q4/| Q3/| Q2/| Q1/| Q4/| Q3/| Q2/| Q1/|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|EBIT | 2009| 2009| 2009| 2009| 2008| 2008| 2008| 2008|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Winter and Outdoor| 42.5| 44.1|-29.2|-10.9| 36.7| 45.7|-26.7|-14.6|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Ball Sports | 2.2| 2.4| 7.4| 11.5| 3.4| 6.6| 11.3| 15.7|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Fitness | -0.5| -1.4| -2.2| -3.4| -2.3| 2.8| -0.4| 3.7|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Headquarters | -4.8| -4.4| -5.4| -4.1| -2.6| -3.6| 8.0| -4.8|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
|Total | 39.4| 40.7|-29.4| -6.9| 35.2| 51.5| -7.8| 0.0|
+------------------+-----+-----+-----+-----+-----+-----+-----+-----+
THE NOTES TO THE FINANCIAL STATEMENTS
1. ACCOUNTING POLICIES
The consolidated financial statements have been prepared in accordance with the
International Financial Reporting Standards (IFRS) approved for use in the EU,
observing the IAS and IFRS standards and SIC and IFRIC interpretations in force
as of December 31, 2009.
In key figures, the hybrid bond has been included in shareholders' equity.
Interest expenses for the hybrid bond have been accrued on the basis of its
coupon rate of 12% and are debited directly to retained earnings net of tax. In
the calculation of earnings per share, interest expenses of the hybrid bond have
been included in the earnings for the period.
Standards and interpretations adopted from the beginning of 2009:
IAS 1 (Revised), "Presentation of Financial Statements": The revised standard
prohibits the presentation of income and expenses items (that is, "non-owner
changes in equity") in the statement of changes in equity, requiring "non-owner
changes in equity" to be presented separately from owner changes in equity. All
non-owner changes in equity will be required to be shown in a performance
statement, but entities can choose whether to present one performance statement
(the statement of comprehensive income) or two statements (the income statement
and the statement of comprehensive income). Where entities restate or reclassify
comparative information, they are required to present a restated balance sheet
as from the beginning of the comparative period in addition to the current
requirement to present balance sheets for the end of the current period and of
the comparative period. The company applies IAS 1 (Revised) from January
1, 2009. Both the income statement and the statement of comprehensive income are
presented as performance statements.
IFRS 8, "Operating Segments": IFRS 8 replaces IAS 14, "Segment Reporting." The
new standard requires a "management approach," under which segment information
is presented on the same basis as that used for internal reporting purposes.
IFRS 8 has not changed the company's segmentation which is consistent with the
company's internal reporting. Furthermore, IFRS 8 requires disclosures, e.g.,
about company's geographical areas of operation and significant customers.
Other changes in accounting policies:
The committed revolving credit facilities used that mature in 2011 and 2012 are
reclassified as long-term interest-bearing liabilities. Comparative information
for 2008 has been restated accordingly.
2. SEGMENT INFORMATION
Amer Sports has three business segments: Winter and Outdoor, Ball Sports and
Fitness.
The accounting policies for segment reporting do not differ from the Group's
accounting policies and have not changed following the adoption of IFRS 8. The
decisions concerning assessing the performance of segments and allocation of
resources to the segments are based on segments' net sales and earnings before
interest and taxes. The chief operating decision maker of Amer Sports is the
Executive Board.
The adoption of IFRS 8 has not changed the reportable segments of Amer Sports
since the segment information previously presented by the Group was based on
internal management reporting. Adoption of the standard affected only the
presentation of the information.
There were no intersegment business operations during the reported periods.
+-------------------+---------+------------+---------+--------+-------+
| | | Earnings|Financing| | |
| | | | |Earnings| |
| | | before| income| | |
| |Net sales| | | before| Assets|
| | |interest and| and| | |
| | | | | taxes| |
| | | taxes| expenses| | |
+-------------------+---------+------------+---------+--------+-------+
|1-12/2009 | | | | | |
+-------------------+---------+------------+---------+--------+-------+
|Winter and Outdoor | 862.6| 46.5| | | 766.3|
+-------------------+---------+------------+---------+--------+-------+
|Ball Sports | 476.7| 23.5| | | 320.7|
+-------------------+---------+------------+---------+--------+-------+
|Fitness | 194.1| -7.5| | | 212.5|
+-------------------+---------+------------+---------+--------+-------+
|Segments, total | 1,533.4| 62.5| | |1,299.5|
+-------------------+---------+------------+---------+--------+-------+
|Unallocated items*)| | -18.7| -18.4| -37.1| 225.1|
+-------------------+---------+------------+---------+--------+-------+
|Group total | 1,533.4| 43.8| -18.4| 25.4|1,524.6|
+-------------------+---------+------------+---------+--------+-------+
+-------------------+---------+------------+---------+--------+-------+
|1-12/2008 | | | | | |
+-------------------+---------+------------+---------+--------+-------+
|Winter and Outdoor | 860.8| 41.1| | | 875.4|
+-------------------+---------+------------+---------+--------+-------+
|Ball Sports | 495.5| 37.0| | | 381.1|
+-------------------+---------+------------+---------+--------+-------+
|Fitness | 220.3| 3.8| | | 245.3|
+-------------------+---------+------------+---------+--------+-------+
|Segments, total | 1,576.6| 81.9| | |1,501.8|
+-------------------+---------+------------+---------+--------+-------+
|Unallocated items*)| | -3.0| -33.3| -36.3| 160.1|
+-------------------+---------+------------+---------+--------+-------+
|Group total | 1,576.6| 78.9| -33.3| 45.6|1,661.9|
+-------------------+---------+------------+---------+--------+-------+
*) Earnings before interest and taxes include income and expenses of corporate
headquarters.
GEOGRAPHIC BREAKDOWN OF NET SALES
+------------+-------+-------+
| | 1-12/| 1-12/|
| | | |
| | 2009| 2008|
+------------+-------+-------+
|Americas | 620.5| 677.8|
+------------+-------+-------+
|EMEA | 735.0| 723.0|
+------------+-------+-------+
|Asia Pacific| 177.9| 175.8|
+------------+-------+-------+
|Total |1,533.4|1,576.6|
+------------+-------+-------+
3. FINANCIAL LIABILITIES
Hybrid bond
In March 2009, Amer Sports Corporation issued a EUR 60 million hybrid bond in
order to strengthen the Group's capital structure and to repay existing debt.
The coupon rate of the bond is 12.0% per annum. The bond has no maturity but the
company may call the bond after three years. The hybrid bond is unsecured and
subordinated to all senior debt and is treated as equity in Amer Sports'
consolidated financial statements. The hybrid bond does not confer shareholders'
rights, nor does it dilute the holdings of shareholders.
Reclassification of the credit facility
Committed revolving credit facilities used that mature in 2011 and 2012 are
presented under long-term interest-bearing liabilities. Comparative information
for 2008 has been restated accordingly. Restatement had EUR 255 million in
effects on short-term and long-term liabilities at the end of 2008.
4. DERIVATIVE FINANCIAL INSTRUMENTS
+----------------------------------+--------+--------+
| |December|December|
| | | |
| |31, 2009|31, 2008|
+----------------------------------+--------+--------+
|Nominal value | | |
+----------------------------------+--------+--------+
|Foreign exchange forward contracts| 502.8| 604.3|
+----------------------------------+--------+--------+
|Forward rate agreements | 100.0| 0.0|
+----------------------------------+--------+--------+
|Interest rate swaps | 204.4| 221.9|
+----------------------------------+--------+--------+
+----------------------------------+--------+--------+
|Fair value | | |
+----------------------------------+--------+--------+
|Foreign exchange forward contracts| -1.0| -1.1|
+----------------------------------+--------+--------+
|Forward rate agreements | -0.1| 0.0|
+----------------------------------+--------+--------+
|Interest rate swaps | -5.6| -7.5|
+----------------------------------+--------+--------+
5. DIVIDENDS
Dividends distributed by Amer Sports to its shareholders and minority
shareholders of its subsidiaries amounted to EUR 11.8 million at the end of
March 2009 relating to the year ending on December 31, 2008 (EUR 0.16 / share
for shareholders of Amer Sports Corporation, totaling EUR 11.6 million).
6. CONTINGENT LIABILITIES AND SECURED ASSETS
+---------------------------------------------+--------+--------+
| |December|December|
| | | |
| |31, 2009|31, 2008|
+---------------------------------------------+--------+--------+
|Guarantees | 10.5| 8.5|
+---------------------------------------------+--------+--------+
|Liabilities for leasing and rental agreements| 116.9| 106.6|
+---------------------------------------------+--------+--------+
|Other liabilities | 30.0| 46.1|
+---------------------------------------------+--------+--------+
There are no guarantees or contingencies given for the management of the
company, the shareholders or the associated companies.
7. SEASONALITY
Although Amer Sports operates in a number of sporting goods segments during all
four seasons, its business is subject to seasonal fluctuations. Historically,
the third and fourth quarters of a financial year have been the strongest
quarters for Amer Sports in terms of both net sales and profitability, mainly
because sales of winter sports equipment ahead of the winter season typically
take place during the third and fourth quarters. During the fourth quarter
Winter Sports Equipment sales grew by 6% in local currencies and its share ofthe total net sales is 42%. The summer season for ball sports balances
seasonality to a certain extent, as the strongest quarters for the Ball Sports
segment are the first and second quarters.
All forecasts and estimates presented in this report are based on the
management's current judgment of the economic environment. The actual results
may differ significantly.
AMER SPORTS CORPORATION
Board of Directors
[HUG#1380634]
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