Samsonite Group (1910) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales were $878 million, down 6.8% year-over-year but up over 20% versus 2019, reflecting tough comps, softer global sentiment, and heightened promotions in China and India.

• Gross margin remained strong at 59.3%, down 30 basis points year-over-year, despite a more promotional environment and regional mix shifts.

• Adjusted EBITDA was $155 million (17.6% margin), down 270 basis points year-over-year, mainly due to lower sales and higher SG&A and advertising expenses.

• Free cash flow was robust at $94 million, up $5 million from Q3 2023, with net debt at $1,148 million and strong liquidity of $1,426 million.

• Significant shareholder returns included $150 million in dividends and $72 million in share buybacks, with dual US listing preparations ongoing.

Financial highlights

• Net sales for Q3 2024 decreased 6.8% year-over-year, but remained over 20% above 2019 levels.

• Gross margin for Q3 was 59.3%, down 30 basis points from last year, mainly due to regional and brand mix.

• Adjusted EBITDA margin was 17.6%, down from 20.3% in Q3 2023.

• Adjusted net income declined by $46 million year-over-year, with adjusted net income for Q3 2024 at $79.7 million, down 36.6%.

• Free cash flow reached $94 million, a $5 million improvement over Q3 2023.

Outlook and guidance

• Full-year 2024 sales expected to be approximately flat on a constant currency basis versus 2023, with sequential improvement in Q4 and growth resuming in 2025.

• Management expects continued share buybacks through 2024 and into 2025.

• Dual listing process in the US is anticipated to increase trading volumes and global investor access.

• Margin profile expected to remain strong, with positive operating leverage and margin expansion targeted in the long run.

• Robust travel trends expected to support long-term growth, with the company historically outperforming industry trends.