On Holding Q3 Net Profit Slips Despite Sales Growth, Lifts Annual Outlook; Pre-Market Stock Up

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Kaufen / Verkaufen

(RTTNews) - On Holding AG (ONON), a Swiss shoemaker, on Tuesday registered a decline in net profit for the third quarter, amidst higher costs, expenses, and loss from foreign exchange. However, the company reported an increase in sales.

For the three-month period to September 30, the firm recorded net profit of 30.5 million Swiss Francs, lower than 58.7 million Swiss Francs, recorded for the same period last year.

Net earnings per Class A share stood at 0.09 Swiss Francs, compared with the prior year's 0.18 Swiss Francs per share.

Net income per Class B share was 0.01 Swiss Francs, down from 0.02 Swiss Francs per share in 2023.

Excluding items, earnings per Class A shares were 44.8 million Swiss Francs or 0.15 Swiss Francs per share, compared with 58.4 million Swiss Francs or 0.20 Swiss Francs per share last year.

Adjusted income per Class B share stood at 5.4 million Swiss Francs or 0.01 Swiss Francs per share against prior year's 7.1 million Swiss Francs or 0.02 Swiss Francs per share.

Income before taxes slipped to 29.6 million Swiss Francs from the previous year's 69.3 million Swiss Francs.

Foreign exchange loss was 42.6 million Swiss Francs, compared with profit of 13.8 million Swiss Francs a year ago.

Selling, general, and administrative expenses stood at 312.7 million Swiss Francs, higher than last year's 229.9 million Swiss Francs. Cost of sales also increased to 250.5 million Swiss Francs from 192.8 million Swiss Francs, a year ago.

Sales increased to 635.8 million Swiss Francs from 480.5 million Swiss Francs a year ago. The strong growth reflects a significant acceleration in On's direct-to-consumer or DTC channel, which grew 49.8 percent, year-over-year, and by 50.7 percent on a constant currency basis.

Citing, third-quarter results, which were ahead of expectations and continued brand momentum, On has revised up annual sales growth outlook to at least 32 percent on a constant currency basis, implying sales of at least 2.29 billion Swiss Francs.

Earlier, for the full year, the company was expecting at least 30 percent sales growth on a constant currency basis, which implies sales of at least 2.26 billion Swiss Francs.

Citing its continued strength of DTC channel, On now expects to exceed its previously stated profit targets.

The company anticipates a gross profit margin of around 60.5 percent and an adjusted EBITDA margin at the upper end of its previous expected range of 16 percent to 16.5 percent.

Earlier, On was expecting an annual gross profit margin of around 60 percent, with an adjusted EBITDA margin of 16 percent to 16.5 percent.

ONON was up by 4.91 percent at $55.30 in the pre-market trade on the New York Stock Exchange.