Consumer goods Running shoe company On continues on record course after second quarter
The running shoe company On continued its record-breaking run in the second quarter. Sales rose sharply and margins also improved. The Zurich-based company, which is listed on the New York Stock Exchange, confirmed its outlook for the year as a whole.
13.08.2024, 11:16
SDA
From April to June, sales rose by 28 percent to CHF 568 million, as On announced on Tuesday. At constant exchange rates, growth was as high as 29 percent. In the first quarter, the company had already clearly exceeded the figures for the record year 2023.
In America, its largest market, On was able to increase sales by around a quarter to CHF 370 million in the second quarter. The Asia-Pacific region continued to show the strongest momentum with an increase of 74 percent to 59 million. Sales in the Europe, Middle East and Africa (EMEA) region also rose sharply by 22% to 138 million.
Higher profitability
The higher proportion of direct sales at full price had a positive impact on profitability, the report continues. The more favorable freight rates compared to the previous year also helped. The gross profit margin rose to 59.9 percent from 59.5 percent in the previous year and the EBITDA margin climbed by almost 2 percentage points to 16.0 percent.
The bottom line was a net profit of CHF 30.8 million, which is almost a tenfold increase compared to the same quarter of the previous year. At that time, high costs due to a temporarily higher proportion of air freight had weighed on the profit figures.
Outlook confirmed
The company, in which Roger Federer also holds a stake, has confirmed its previous targets for the current year: Adjusted for currency effects, turnover should increase by "at least 30 percent". At current exchange rates, this would correspond to at least 2.26 billion Swiss francs, according to the statement. In 2023, On exceeded the billion franc mark for the first time with 1.22 billion francs.
At the same time, the gross profit margin is expected to be around 60 percent in the current year. The adjusted EBITDA margin is still expected to be in a range between 16.0 and 16.5 percent.
