Shares of performance sportswear company On Holding AG (NYSE:ONON) are trading higher in premarket on Tuesday after the fourth-quarter FY24 earnings.
The company reported fourth-quarter sales growth of 35.7% year-on-year to 606.6 million Swiss Francs ($691.47 million), beating the analyst consensus estimate of $594.49 million.
The strong performance was supported by On’s ability to convert on the rapid rise in brand awareness across the globe.
Direct to consumer sales increased 43.4% to CHF 296.2 million and that of wholesale climbed 29.1% to CHF 310.4 million.
Net sales in EMEA, Americas and Asia-Pacific increased by 31.0% to CHF 147.4 million, 28.1% to CHF 385.1 million, 117.5% to CHF 74.1 million, respectively.
Gross profit jumped by 39.5% to CHF 376.8 million from CHF 270.2 million last year and the gross margin expanded 170 basis points to 62.1%.
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The operating income for the quarter grew 30.2% to CHF 53.1 million and the operating margin contracted by 30 basis points to 8.8%.
Adjusted EPS of $0.38 beat the consensus estimate of $0.18.
Adjusted EBITDA improved by 38.3% to CHF 99.4 million and the adjusted EBITDA margin expanded 30 basis points to 16.4%.
The company held CHF 924.3 million in cash and equivalents as of December 31, 2024.
Outlook 2025: ON expects to achieve a constant currency net sales growth rate of at least 27% to CHF 2.94 billion.
On expects to maintain its gross profit margin at around 60.5%. The company sees adjusted EBITDA margin in the range of 17.0% – 17.5%.
Also, On said it is steadily progressing toward its ambitious mid-term target of achieving an adjusted EBITDA margin of over 18% in 2026.
Price Action: ON shares are trading higher by 6.69% at $51.05 in premarket at last check Tuesday.
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