On AG(ONON)2024-08-13 16:08Financial Data and Key Metrics Changes - The company reported net sales of CHF567.7 million in Q2 2024, representing a growth of 28% year-over-year, with a constant currency growth of 29.4% [4][20] - Gross profit reached CHF340.2 million, resulting in a gross profit margin of 59.9% [32] - Net income increased significantly to CHF30.8 million from CHF3.3 million in Q2 2023 [33] Business Line Data and Key Metrics Changes - Wholesale net sales grew by 27.6% to CHF358.2 million, while D2C sales reached CHF209.4 million, growing by 28.1% year-over-year [21][22] - The footwear segment saw a growth of 26.7%, reaching CHF542.5 million, with strong demand across all product verticals [27] - Apparel sales grew by 63% to CHF21.9 million, indicating a strong momentum in this category [30] Market Data and Key Metrics Changes - EMEA region net sales reached CHF138.4 million, growing by 21.8% year-over-year [25] - The Americas contributed CHF370 million in Q2, with a growth rate of 24.8% [26] - APEC region experienced remarkable growth of 73.7%, reaching CHF59.2 million [27] Company Strategy and Development Direction - The company emphasizes long-term growth and innovation, highlighted by the introduction of the LightSpray technology, which aims to revolutionize manufacturing and sustainability [12][14] - The strategy includes a focus on existing distribution partners and deeper penetration in strategic accounts to drive growth [21] - The company plans to maintain a strong marketing presence and brand awareness through partnerships and events, such as the collaboration with Zendaya [16][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a constant-currency net sales growth rate of at least 30% for 2024, despite ongoing distribution challenges [36] - The company anticipates a strong second half of the year, driven by holiday season sales and a higher volume of products [49] - Management acknowledged the need to improve operational efficiency and inventory management to meet consumer demand [41][42] Other Important Information - The company surpassed CHF1 billion in net sales in a six-month period for the first time, marking a significant milestone [20] - The transition to a fully automated warehouse in Atlanta is expected to enhance distribution capabilities in the long term [41] Q&A Session Summary Question: Constraints in North America and prioritization of new launches - Management discussed the ongoing transition of the Atlanta warehouse causing capacity constraints, leading to unreliable deliveries and inventory shortages [40][41] Question: Marketing metrics and consumer engagement - The visibility of the brand increased significantly, with Zendaya's air tennis match viewed over 15 million times on Instagram [44][45] Question: Adjusted EBITDA margin guidance for the second half - Management expects a slight reacceleration in the second half due to higher sales volume and lower marketing expenses as a percentage of net sales [48][49] Question: EMEA channel dynamics and door closures - Management noted a stabilization in EMEA performance and a positive outlook for Q3 and Q4, with a focus on existing store growth [50][51] Question: New product launches and market positioning - Management highlighted excitement around new footwear launches, including the Cloudrunner 2 and Cloudboom Strike, and emphasized the importance of apparel growth [60][62]