On has significantly over-delivered on its IPO
growth strategies, adding over CHF1bn in Net Sales since its NYSE
listing in September 2021
By 2026, On intends to double its expected full
year 2023 net sales and increase its adjusted EBITDA margin to
18%+
Vision to be the most premium global sportswear
brand
Three strategic growth pillars will ignite On’s
future growth path - Elevate the current core business and
communities, Expand additional growth drivers such as China
and own retail and Establish new building blocks, including
Tennis and Training
Swiss performance sportswear brand On (NYSE: ONON) will today,
October 4, 2023, host an Investor Day at On Labs in Zurich,
Switzerland. Two years after the Company’s IPO and following the
successful execution on the growth strategies presented during the
listing process, the Company is providing an update on its
strategic priorities and vision. As a part of the event, the
Company is announcing three-year (FY 2026) financial targets and
introducing the strategic building blocks to support this next
stage of growth.
Following On’s track record of strong growth and increasing
profitability, the Company intends to double its expected 2023 net
sales by 2026, while increasing its adjusted EBITDA margin to 18%+
in the same timeframe. On is further setting out to build the
foundation for a much bigger company in the future, with the
long-term ambition to build the most premium, global sportswear
brand.
“We are extremely proud and pleased with how we have been able
to successfully deliver on our mission and growth strategies over
the past two years,” said Marc Maurer, Co-CEO. “The strength of our
brand and products, our outstanding team and innovation
capabilities, as well as the very large addressable market, give us
numerous opportunities to grow. We are staying true to our core,
with controlled expansion into adjacencies, to continue on our path
towards the vision to be the most premium global sportswear
brand.”
On’s strategic vision for the next stage of growth includes the
three strategic growth pillars Elevate, Expand and Establish:
- Elevate: On continues to see significant runway for
growth in its core areas. The growth pillar Elevate includes the
strategic building blocks to further elevate its market share in
running, its brand awareness among its communities as well as its
performance credibility and sustainability impact
- Expand: On is at the early stage of geographic expansion
and sees potential to build its footprint considerably. The growth
pillar Expand includes the strategic building blocks to expand its
premium multi-channel distribution, its own retail presence, and
its footprint in China
- Establish: On is stepping into selected adjacencies,
while staying true to its philosophy centered around establishing
credibility in performance. The growth pillar Establish includes
the strategic building blocks to establish its training community
and light up the tennis court, as well as to establish full
head-to-toe looks across all its verticals
Financial Ambitions
Besides updating its strategic priorities, On today is
reiterating its previously provided outlook for the full fiscal
year ending December 31, 2023. This includes the expectations to
reach CHF 1.76 billion in net sales, at least 58.5% gross profit
margin and 15.0% adjusted EBITDA margin respectively.
On’s strategic growth pillars will set the basis to continue to
deliver on the philosophy of combining strong growth alongside
attractive and increasing profitability. By 2026, On intends to
deliver on the following financial ambitions:
- Doubling net sales between 2023 and 2026 to at least CHF 3.55
billion, reflecting a CAGR of over 26% based on the outlook for the
full fiscal year ending December 31, 2023
- Exceeding 60% gross profit margin by 2026
- Deliver economies of scale, with the ambition to reach 18%+
adjusted EBITDA margin by 2026
“We have an exciting product pipeline that includes running,
training, and tennis footwear and apparel. Additionally, we believe
there are huge opportunities to increase brand awareness and to
expand through our multi-channel approach. We are enthusiastic
about our continued growth.” said Martin Hoffmann, Co-CEO and CFO.
“The 2026 targets announced today continue to be above the
long-term ambitions shared at the time of the IPO, and we view them
as an intermediate step in our ambition to build a much bigger
company in the future”.
Beyond the stated ambitions for 2026 and resulting from the
vision to build the most premium global sportswear brand, the
Company further announces the long-term targets to drive towards an
apparel share of 10%+, an own retail share of 10%+ and a China
share of 10%+ in relation to its overall net sales. Similarly, the
Company expects to further drive profitability beyond 2026, with
the aspiration to grow Net Sales by 20 - 25% per year and exceed
20% adjusted EBITDA margin as its updated long-term targets.
Webcast Information
A live webcast of the presentation and Q&A session will be
available at 8 a.m. U.S. Eastern Time (2 p.m. Central European
Time) on the Company’s investor relations website and via the
following link. A recording will be available after the live event.
The presentation will be held by several members of the On
management team.
About On
On was born in the Swiss Alps with one goal: to revolutionize
the sensation of running by empowering all to run on clouds.
Thirteen years after market launch, On delivers industry-disrupting
innovation in premium footwear, apparel and accessories for
high-performance running, outdoor and all-day activities. Fueled by
customer-recommendation, On’s award-winning CloudTec® innovation,
purposeful design and groundbreaking strides in sportswear’s
circular economy have attracted a fast-growing global fanbase —
inspiring humans to explore, discover and Dream On.
On is present in more than 60 countries globally and engages
with a digital community on www.on.com.
Forward-Looking Statements
This press release includes estimates, projections, statements
relating to the business plans, objectives, and expected operating
results of On Holding AG (“On” or the “Company”) that are
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. In many cases, you can identify forward-looking
statements by terms such as “may,” “will,” “should,” “expects,”
“plans,” “anticipates,” “target,” “outlook,” “believes,” “intends,”
“estimates,” “predicts,” “potential” or the negative of these terms
or other comparable terminology. These forward looking statements
include, without limitation, projections, guidance and outlook
statements, our long-term targets, statements regarding our ability
to meet environmental, social and governance goals, expectations
regarding industry trends and the size and growth rates of
addressable markets, and statements regarding our business plan and
our growth strategies, including plans for expansion to new markets
and new products. These statements are based on management’s
current expectations but they involve a number of risks and
uncertainties. Actual results and the timing of events could differ
materially from those anticipated in the forward-looking statements
as a result of risks and uncertainties, which include, without
limitation: the strength of our brand and our ability to maintain
our reputation and brand image; our ability and the ability of our
independent manufacturers and other suppliers to follow responsible
business practices; our ability to implement our growth strategy;
the concentration of our business in a single, discretionary
product category, namely footwear, apparel and accessories; our
ability to continue to innovate and meet consumer expectations;
changes in consumer tastes and preferences including in products
and sustainability, and our ability to connect with our consumer
base; our generation of net losses in the past and potentially in
the future; our limited operating experience in new markets; our
ability to open new stores at locations that will attract customers
to our premium products; our ability to compete and conduct our
business in the future; health epidemics, pandemics and similar
outbreaks, including the COVID-19 pandemic; general economic,
political, demographic and business conditions worldwide, including
geopolitical uncertainty and instability, such as the
Russia-Ukraine conflict; the success of operating initiatives,
including advertising and promotional efforts and new product and
concept development by us and our competitors; our ability to
strengthen our direct-to-consumer (“DTC”) channel; our ability to
execute on our sustainability strategy and achieve our
sustainability-related goals and targets, including sustainable
product offerings; our third-party suppliers, manufacturers and
other partners, including their financial stability and our ability
to find suitable partners to implement our growth strategy; supply
chain disruptions, inflation and increased costs in supplies, goods
and transportation; the availability of qualified personnel and the
ability to retain such personnel, including our extended founder
team; our ability to accurately forecast demand for our products
and manage product manufacturing decisions; our ability to
distribute products through our wholesale channel; changes in
commodity, material, labor, distribution and other operating costs;
our international operations; our ability to protect our
intellectual property and defend against allegations of violations
of third-party intellectual property by us; security breaches and
other disruptions to our IT systems; increased hacking activity
against the critical infrastructure of any nation or organization
that retaliates against Russia for its invasion of Ukraine; our
reliance on complex IT systems; financial accounting and tax
matters; any material weaknesses identified in our internal control
over financial reporting and remediation efforts; the potential
impact of, and our compliance with, new and existing laws and
regulations; other factors that may affect our financial condition,
liquidity and results of operations; and other risks and
uncertainties set out in filings made from time to time with the
SEC and available at www.sec.gov, including, without limitation,
our most recent reports on Form 20-F and Form 6-K. You are urged to
consider these factors carefully in evaluating the forward-looking
statements contained herein and are cautioned not to place undue
reliance on such forward-looking statements, which are qualified in
their entirety by these cautionary statements. The forward-looking
statements made herein speak only as of the date of this press
release and the Company undertakes no obligation to publicly update
such forward-looking statements to reflect subsequent events or
circumstances, except as may be required by law.
Non-IFRS Financial Measures
Included in this press release are certain financial measures
that are not calculated in accordance with International Financial
Reporting Standards (“IFRS”), including adjusted EBITDA and
adjusted EBITDA margin. Such measures are designed to supplement,
and not substitute, On’s financial information presented in
accordance with IFRS. The non-IFRS measures as defined by On’s may
not be comparable to similar non-IFRS measures presented by other
companies. The presentation of such measures, which may include
adjustments to exclude unusual or non-recurring items, should not
be construed as an inference that On’s future results will be
unaffected by other unusual or nonrecurring items.
We do not provide a reconciliation of forward-looking adjusted
EBITDA to IFRS net income due to the inherent difficulty in
forecasting and quantifying certain amounts that are necessary for
such reconciliation. The amount of these deductions may be material
and, therefore, could result in projected net income being
materially less than projected adjusted EBITDA. These statements
represent forward-looking information and may represent a financial
outlook, and actual results may vary. Please see the risks and
assumptions referred to in the Forward-Looking Statements section
of this news release.
Source: On
Category: Corporate
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231003812488/en/
Investors: On Holding AG Jerrit Peter investorrelations@on.com
or ICR, Inc. Brendon Frey brendon.frey@icrinc.com
Media: On Holding AG Vesna Stimac press@on.com
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