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Accelerating for the future / September 12, 2014
Faster growth, higher profitability, investing for
the future — in short, that´s the Sustainable Growth Model (SGM)
presented by Heikki Takala, Amer Sports President and CEO at the 2014
Capital Markets Day.
– We want to grow profitably and we want to have a healthy balance sheet. The Sustainable Growth Model is our guiding light when we make decisions and shape our strategies, stressed Takala in his Capital Markets Day opening speech.
The model consists of three basic components: growth, making and improving profits and investing for the future. All three are equally important.
Organic growth
Growth can be organic or through acquisitions.
– We prefer organic growth, Takala said.
– We have in the past four years grown our business organically from 1.5 billion in 2009 to 2.1 billion
in 2013 and the compound annual growth rate has been 8% in local currencies This has been achieved through faster growth in softgoods and strengthening our Go to Market: controlled distribution expansion, emerging markets and own retail.
To achieve better profitability, there are also two approaches.
– Profitability can come from growth or through cutting costs. We have been investing in growth, it has worked and we are growing. Hence, we prefer growth.
Investing for the future includes also better asset efficiency. Renewal is the key word.
– We renew ourselves constantly; we seek to allocate our resources in the best possible way into more attractive areas: faster growth, higher profitability, better asset efficiency.
Recent history proves that the principles of the SGM have worked.
– We continue growing according to our long-term targets. In profitability, getting EBIT to 10% mid-term, we continue improving. We also generate cash and we have significantly improved our balance sheet. It is much stronger than ever before.
Amer Sports portfolio logic
Amer Sports is a balanced equipment and softgoods company, with a unique model of leveraging authentic brands.
- Amer Sports is an integrated company where portfolio composition is determined by synergies and Amer Sports being the “right owner”, Takala said.
- We are the right owner for any asset as long as we develop or improve it relatively better than its competitors or we can create competitive advantage through unique portfolio logic so that brands together are stronger than any brand alone.
– As long as we own an asset, we continue driving it. We drive its revenue, we seek to make profits and we invest in its future, said Takala.
Every business area is improving its performance.
– We are focusing on delivering our mid-term targets and we are preparing for the acceleration. We follow the SGM, we do the appropriate renewal which enables us to move towards future acceleration. Then it’s all about growing faster, concluded Takala.
Accelerating digital products
Amer Sports is seeking new growth from digital products and services.
– Digital and connected products are already five per cent of the company sales. We also offer a magnitude of digitally customized products, said Takala.
Amer Sports now talks about the Connected Digital Ecosystem.
– We connect the consumer to digital devices and service platforms. We seek to bring the consumer data to our databases. With Amer Sports e-commerce, we can then convert the consumer contact into purchases. That’s the revenue logic.
– We are now accelerating in digital. We have the basic capabilities in place. We are seeking to drive digitally connected products towards bigger share of the overall company.
– We want to grow profitably and we want to have a healthy balance sheet. The Sustainable Growth Model is our guiding light when we make decisions and shape our strategies, stressed Takala in his Capital Markets Day opening speech.
The model consists of three basic components: growth, making and improving profits and investing for the future. All three are equally important.
Organic growth
Growth can be organic or through acquisitions.
– We prefer organic growth, Takala said.
– We have in the past four years grown our business organically from 1.5 billion in 2009 to 2.1 billion
in 2013 and the compound annual growth rate has been 8% in local currencies This has been achieved through faster growth in softgoods and strengthening our Go to Market: controlled distribution expansion, emerging markets and own retail.
To achieve better profitability, there are also two approaches.
– Profitability can come from growth or through cutting costs. We have been investing in growth, it has worked and we are growing. Hence, we prefer growth.
Investing for the future includes also better asset efficiency. Renewal is the key word.
– We renew ourselves constantly; we seek to allocate our resources in the best possible way into more attractive areas: faster growth, higher profitability, better asset efficiency.
Recent history proves that the principles of the SGM have worked.
– We continue growing according to our long-term targets. In profitability, getting EBIT to 10% mid-term, we continue improving. We also generate cash and we have significantly improved our balance sheet. It is much stronger than ever before.
Amer Sports portfolio logic
Amer Sports is a balanced equipment and softgoods company, with a unique model of leveraging authentic brands.
- Amer Sports is an integrated company where portfolio composition is determined by synergies and Amer Sports being the “right owner”, Takala said.
- We are the right owner for any asset as long as we develop or improve it relatively better than its competitors or we can create competitive advantage through unique portfolio logic so that brands together are stronger than any brand alone.
– As long as we own an asset, we continue driving it. We drive its revenue, we seek to make profits and we invest in its future, said Takala.
Every business area is improving its performance.
– We are focusing on delivering our mid-term targets and we are preparing for the acceleration. We follow the SGM, we do the appropriate renewal which enables us to move towards future acceleration. Then it’s all about growing faster, concluded Takala.
Accelerating digital products
Amer Sports is seeking new growth from digital products and services.
– Digital and connected products are already five per cent of the company sales. We also offer a magnitude of digitally customized products, said Takala.
Amer Sports now talks about the Connected Digital Ecosystem.
– We connect the consumer to digital devices and service platforms. We seek to bring the consumer data to our databases. With Amer Sports e-commerce, we can then convert the consumer contact into purchases. That’s the revenue logic.
– We are now accelerating in digital. We have the basic capabilities in place. We are seeking to drive digitally connected products towards bigger share of the overall company.
Source Amer sports
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