On AG(US:ONON)2025-08-12 13:00Financial Data and Key Metrics Changes - The company reported net sales of CHF 749.2 million, representing a 32% year-over-year increase on a reported basis and a 38.2% increase on a constant currency basis [31][29] - Adjusted EBITDA reached CHF 136.1 million, translating to an adjusted EBITDA margin of 18.2%, up 220 basis points year-over-year [41][30] - Gross profit margin increased by 160 basis points year-over-year to 61.5%, driven by a higher D2C share and lower freight expenses [39][40] Business Line Data and Key Metrics Changes - The Direct-to-Consumer (D2C) channel saw net sales of CHF 308.3 million, up 54.3% year-over-year at constant currency [31] - The apparel business delivered net sales growth of 75.5% at constant exchange rates, reaching CHF 36.7 million [38] - Net sales from shoes grew 36% at constant exchange rates, with strong demand across both Performance and Lifestyle portfolios [37] Market Data and Key Metrics Changes - EMEA region net sales grew by 46.1% year-over-year on a constant currency basis, reaching CHF 197.8 million [34] - The Americas saw net sales growth of 23.6% on a constant currency basis, totaling CHF 432.3 million [35] - The APAC region experienced triple-digit growth, with net sales up 110.9% year-over-year, translating to CHF 119.2 million [36] Company Strategy and Development Direction - The company aims to be the most premium global sportswear brand, focusing on innovation, quality, and customer experience [50][51] - A strategic emphasis on building a balanced portfolio with nine distinct footwear franchises, each contributing over 5% to the top line [9][80] - The company is expanding its apparel business and enhancing its relevance as a full sportswear brand, with plans for new product launches and collaborations [10][81] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the brand's momentum and the ability to navigate macroeconomic challenges, including tariffs [64][62] - The company anticipates continued strong performance in Q3 and has raised its full-year guidance for net sales growth to at least 31% year-over-year [48][47] - Management highlighted the importance of maintaining a premium brand position and investing in long-term growth initiatives [50][51] Other Important Information - The company opened its first retail store in Singapore, which achieved high sales during its opening weekend [27] - The launch of the LightSpray factory in Zurich represents a significant innovation in manufacturing processes [18] - The company has a strong cash position of CHF 846.6 million, despite a decrease from the previous quarter [44] Q&A Session Summary Question: What gives you the confidence to raise your constant currency sales growth guidance for the year? - Management cited strong brand momentum globally, with significant growth across all regions and product categories, and a strong order book for Q3 [56][58] Question: Can you talk about the second half constant currency revenue growth and trends in wholesale and DTC? - Management emphasized the importance of durable, high-quality growth and indicated that they are well-positioned for continued momentum in both channels [68][70] Question: What are the levers for additional margin expansion given current performance? - Management highlighted opportunities for increased gross profit margin through a higher D2C mix, economies of scale, and continued investment in brand-building initiatives [71][72] Question: Can you expand on the gross margin outlook for the year? - Management expressed confidence in maintaining gross profit margins above 60%, supported by price increases and operational efficiencies [92][93] Question: How is the apparel strategy evolving? - Management noted strong consumer engagement in apparel, driven by direct-to-consumer channels and collaborations with influencers, and plans to continue expanding this category [96][97]