Finland's Amer Sports Q3 revenue reaches $1.35 bn, 17% YoY growth

By segment, Technical Apparel’s revenue increased by 34 per cent YoY to $520 million (33 per cent YoY) on a constant currency basis, Outdoor Performance increased 8 per cent to $534 million or increased 7 per cent on a constant currency basis. Ball & Racquet sports increased to $300 million, which represents 11 per cent growth on both a reported and constant currency basis, Finland-based Amer Sports said in a press statement.

The operating margin of the company in the third quarter increased 400 basis points (bps) to 13.1 per cent YoY, and adjusted operating margin increased 280 basis points to 14.4 per cent. By segment, adjusted operating margin of Technical Apparel increased 370 basis points to 20.0 per cent YoY, Outdoor Performance decreased 40 basis points to 17.5 per cent, and Ball & Racquet Sports increased 600 basis points to 6.9 per cent.

The cost of goods sold increased to $606.5 million from $564.9 million in Q3 last year and gross profit improved to $747.3 million from $588.2 million in Q3 2023. Selling, general, and administrative (SG&A) expenses increased to $586.5 million from $488.1 million YoY. Other operating income increased to $15.9 million from $1.7 million in Q3 last year. Net finance cost decreased to $47.8 million from $108.0 million in Q3 2023. Income before tax improved to $128.9 million from a loss of $3.3 million.

Income tax expense increased to $72.7 million from $32.6 million YoY. Net income improved to $56.2 million from a loss of $35.9 million in Q3 last year. Diluted earnings per share (EPS) improved to $0.11 from a loss of $0.10 YoY.

“Third quarter was very strong for Amer Sports Group across all brands and geographies. Led by Arc'teryx, our unique portfolio of premium technical brands continues to create white space and take market share in sports and outdoor markets around the world. We are executing against our largest growth opportunities in Arc'teryx and Salomon footwear, while our market-leading Ball & Racquet franchise experienced a growth acceleration,” said James Zheng, chief executive officer (CEO) of Amer Sports.

Nine-months (9M) financials

For nine months period ended September 30, 2024, revenue increased to $3,547.8 million from $3,072.9 million for the same period in the previous year. The cost of goods sold increased to $1,593.5 million from $1,460.5 million in Q3 2023, and gross profit improved to $1,954.3 million from $1,612.4 million YoY. SG&A expenses increased to $1,698.1 million from $1,368.5 million in Q3 2023. The other operating income of the company in this period increased to $23.5 million from $3.3 million in 9M 2023. The operating profit increased to $277.2 million from $242.6 million YoY, and net finance cost decreased to $186.9 million from $292.1 million. The income before tax improved to $90.3 million from a loss of $49.5 million in this period in 2023. The income tax expense decreased to $29.0 million from $64.4 million, and net income improved to $61.3 million from a loss of $113.9 million. The earnings per share (diluted) improved to $0.12 from a loss of $0.30 YoY.

For full-year ending December 31, 2024, Amer Sports expects revenue growth of 16 -17 per cent, gross margin at 55.-55.5 per cent, and operating margin towards high-end of 10.5 -11.0 per cent. The company expects net finance cost of sales (cos) between $200 and $210 million, including approximately $15 million of finance costs in the first quarter 2024 that would not be recurring. The effective tax rate of the company is expected to be 37 per cent, fully diluted share count to be approximately 500 million, and fully diluted EPS to be in the range of $0.43-0.45.

“Another quarter of high-teens organic growth accompanied by healthy gross- and operating-margin expansion reflects the combination of great brands and strong execution by our teams around the world. Very strong growth from our highest-margin Arc'teryx franchise combined with improving trends in both Ball & Racquet and Winter Sports Equipment give us the confidence to raise our full-year sales and earnings guidance,” said chief financial officer (CFO) Andrew Page. “As we begin to look beyond this year, we are also confident in our initial 2025 outlook and expect to deliver results consistent with our long-term financial algorithm of low-double-digit to mid-teens annual revenue growth and 30-70+ bps of annual adjusted operating margin expansion driven by gross margin expansion.”

Fibre2Fashion News Desk (SG)