I am pleased with the Company's solid performance in 2024, which underscored its resilient business model, enhanced margin profile and ongoing discipline on expense management. 本人對本公司於2024年的穩健表現甚感欣慰，其突顯了本公司富有韌性 的業務模式、利潤率的提升及對開支的持續嚴格管理。 Timothy Charles Parker Chairman 主席 CONTENTS 目錄 Celebrating 115 Years Page 頁次 Samsonite Group S.A. Annual Report 2024 1 新秀麗集團有限公司 年報 2024 2 Corporate Information 公司資料 3 Corporate Profile 公司簡介 3 The Company's Culture and Strategy 本公司的文化及策略 6 Disclaimer 免責聲明 12 Results of Operat ...

Investment Rating - The report maintains a BUY rating for the company with a target price (TP) revised down by 9% to HK$ 25.35, implying a 36.9% upside from the current price of HK$ 18.52 [1][3]. Core Insights - The company experienced mixed performance in FY24, with net sales remaining flat at US$ 3.6 billion, while net profit decreased by 13% YoY to US$ 346 million, primarily due to higher selling expenses and fewer impairment reversals [1][2]. - Major markets such as Asia and North America saw declines of 3.6% and 1.2% YoY, respectively, but growth in Europe and Latin America offset these declines with increases of 3.1% and 17.0% YoY [1]. - The management anticipates a decline in sales for 1Q25, projecting a fall by low single digits to mid single digits, influenced by weak US consumer sentiment despite a recovery in Asia [1][9]. - Organic sales and net profit are expected to grow by 1.5% and 1.8% YoY in FY25E, respectively, supported by ongoing share buybacks and progress in dual-listing [1][9]. Financial Summary - For FY24, the company reported revenue of US$ 3,589 million, a decrease of 2.5% YoY, with a projected revenue of US$ 3,731 million for FY25E, reflecting a growth of 4.0% [2][32]. - The net profit for FY24 was US$ 346 million, down 12.9% YoY, with an expected slight recovery to US$ 351.8 million in FY25E [2][32]. - The report indicates a decline in gross profit margin from 60.0% in FY24 to an expected 59.5% in FY25E, while the operating profit margin is projected to remain at 17.1% [29][32]. Market Performance - The company's stock has seen a decline of 14.1% over the past month and 14.3% over the past three months, indicating a challenging market environment [5]. - The current market capitalization stands at HK$ 26,729.4 million, with an average turnover of HK$ 128.1 million over the last three months [3]. Shareholding Structure - Major shareholders include Schroders PLC with 6.0% and Bank of New York Mellon Corporation with 5.4% [4]. E-commerce Performance - In the first two months of FY25, online sales on major platforms like TBTM and JD.com decreased by 7% and 18% YoY, while sales on Douyin surged by 200% YoY, indicating a shift in consumer preferences and effective marketing strategies [9][15].

Investment Rating - The investment rating for the company is "Outperform" [5][14]. Core Insights - The report highlights that the company's gross profit margin remains robust at 60.2% for Q4, with expectations for revenue growth to improve in Q1 2025 [7][14]. - The company has announced a buyback plan, reflecting long-term confidence in its performance [2][14]. - The overall revenue for 2024 is projected to decline by 2.5% to USD 3.59 billion, with a slight recovery expected in 2025 [7][14]. Financial Data and Forecasts - **Revenue Forecast**: - 2023: USD 3,682 million - 2024: USD 3,589 million - 2025E: USD 3,743 million - 2026E: USD 3,928 million - 2027E: USD 4,118 million - Year-over-year growth rates show a decline of 2.5% in 2024, followed by modest growth in subsequent years [4][11]. - **Net Profit Forecast**: - 2023: USD 417 million - 2024: USD 346 million - 2025E: USD 382 million - 2026E: USD 413 million - 2027E: USD 440 million - The net profit margin is expected to recover gradually after a decline in 2024 [4][11]. - **Earnings Per Share (EPS)**: - 2023: USD 0.29 - 2024: USD 0.24 - 2025E: USD 0.26 - 2026E: USD 0.28 - 2027E: USD 0.30 [4][11]. - **Gross Margin**: - 2023: 59.3% - 2024: 60.0% - 2025E: 60.0% - 2026E: 60.1% - 2027E: 60.2% [4][11]. - **Return on Equity (ROE)**: - 2023: 28.8% - 2024: 23.4% - 2025E: 20.6% - 2026E: 18.2% - 2027E: 16.2% [4][11]. Market Performance - The company's stock closed at HKD 19.10, with a 52-week price range of HKD 16.78 to HKD 31.60 [5][14]. - The total market capitalization is approximately HKD 27,930 million [5][14]. Revenue Performance by Region - Q4 2024 revenue showed a slight decline of 0.1% year-over-year, with a currency-neutral increase of 1% [7][14]. - Revenue changes in Q4 2024 by region were as follows: - Asia: -6.3% - North America: +3.9% - Europe: +5.6% - Latin America: +14% [7][14]. Cash Flow and Dividends - Adjusted free cash flow increased by 9.3% to USD 310 million [7][14]. - Total dividends for the year were USD 150 million, with a payout ratio of 43.4% [7][14].

Investment Rating - The investment rating for the company is "Buy" [7] Core Views - The company reported a revenue of $3.6 billion for 2024, a year-on-year decrease of 2.5%, but a slight decline of 0.2% when excluding foreign exchange impacts. Adjusted EBITDA was $680 million, down 3.7% year-on-year, and net profit attributable to shareholders was $350 million, down 12.9% year-on-year. In Q4 alone, revenue reached $940 million, a year-on-year decrease of 0.6%, with adjusted EBITDA of $190 million, up 7.7% year-on-year, and net profit of $110 million, up 22.7% year-on-year [1][5][12]. Summary by Sections Revenue Performance - In Q4, North America, Europe, and China saw positive revenue growth, while India and South Korea experienced declines, leading to a 7% year-on-year drop in Asian revenue. Specifically, revenue from China was $70 million (up 2%), India $50 million (down 28%), Japan $50 million (up 3%), and South Korea $30 million (down 17%). North America generated $350 million (up 4%), with the U.S. contributing $330 million (up 4%). Europe achieved $210 million (up 5%), with Belgium at $60 million (up 16%) and Germany at $30 million (down 7%) [2][3]. Brand and Channel Performance - In Q4, the brands TUMI and Samsonite saw revenue growth, with TUMI at $250 million (up 4%) and Samsonite at $480 million (up 3%). The DTC (Direct-to-Consumer) channel showed stable performance, with revenues of $280 million (up 0.1%) and $130 million (up 1.2%) for DTC self-operated and DTC e-commerce channels, respectively. The company plans to open 67 new stores, increasing the total to 1,119, demonstrating confidence in growth despite a weak retail environment [3][4]. Profitability and Margins - The gross margin for Q4 was 60.2%, an increase of 0.3 percentage points year-on-year, attributed to higher-end brand performance and discount control. The adjusted EBITDA margin reached 20.7%, a historical high, while the net profit margin was 12.2%, down 3.5 percentage points year-on-year due to a high base from previous impairment reversals [4][5]. Earnings Forecast and Valuation - The company is expected to achieve revenues of $3.7 billion, $3.8 billion, and $3.9 billion for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 1.8%, 4.1%, and 3.5%. Net profit attributable to shareholders is projected to be $370 million, $410 million, and $460 million for the same years, with growth rates of 6.2%, 10.8%, and 12.8%. The price-to-earnings ratio is estimated to be 10, 9, and 8 times for the respective years [5][12][13].

Investment Rating - The investment rating for the company is "Buy" [7] Core Insights - The company reported a revenue of $3.6 billion for 2024, a year-on-year decrease of 2.5%, but a slight decrease of 0.2% when excluding foreign exchange impacts. Adjusted EBITDA was $680 million, down 3.7% year-on-year, and net profit attributable to shareholders was $350 million, down 12.9% year-on-year. In Q4 alone, revenue reached $940 million, a year-on-year decrease of 0.6%, with adjusted EBITDA of $190 million, up 7.7% year-on-year, and net profit of $110 million, up 22.7% year-on-year [1][5] Summary by Sections Revenue Performance - In Q4, North America, Europe, and China saw positive revenue growth, while India and South Korea experienced declines, leading to a 7% year-on-year decrease in Asian revenue. Specifically, revenue from China was $70 million (up 2% year-on-year), India was $50 million (down 28% year-on-year), Japan was $50 million (up 3% year-on-year), and South Korea was $30 million (down 17% year-on-year) [2] Brand and Channel Performance - In Q4, revenue from the brands Samsonite, TUMI, and American Tourister was $480 million, $250 million, and $150 million, respectively, showing year-on-year growth of 3%, 4%, and a decline of 9%. The DTC (Direct-to-Consumer) channel showed stable performance with revenues of $280 million, $130 million, and $540 million from wholesale, DTC self-operated, and DTC e-commerce channels, respectively [3] Profitability and Margins - The gross margin for Q4 was 60.2%, an increase of 0.3 percentage points year-on-year, primarily due to the higher growth rate of the premium TUMI brand and effective discount control. The adjusted EBITDA margin reached 20.7%, a historical high, while the net profit margin was 12.2%, reflecting a year-on-year decline mainly due to a high base from previous impairment reversals [4] Earnings Forecast and Valuation - The company is expected to achieve revenues of $3.7 billion, $3.8 billion, and $3.9 billion for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 1.8%, 4.1%, and 3.5%. Net profit attributable to shareholders is projected to be $370 million, $410 million, and $460 million for the same years, with corresponding growth rates of 6.2%, 10.8%, and 12.8%. The price-to-earnings ratio is estimated to be 10, 9, and 8 times for 2025, 2026, and 2027, respectively [5][12]

Investment Rating - The investment rating for the company is "Outperform the Market" and is maintained [2]. Core Views - The report highlights that the company has a solid position as the world's largest luggage brand, with TUMI's store openings gradually realizing potential, and long-term growth prospects in the Asia-Pacific region [7]. - The company is expected to see a net profit of $382 million in 2025 and $413 million in 2026, with a price-to-earnings (PE) valuation range of 14-15X for 2025, translating to a fair value range of HKD 28.60-30.65 per share [7]. Financial Performance Summary - For 2023, the company reported a revenue of $3.682 billion, with a year-on-year growth of 27.9%. However, a slight decline of 2.5% is expected in 2024, with revenues projected at $3.589 billion [6]. - The net profit for 2023 was $417 million, reflecting a year-on-year increase of 33.4%, but a decrease of 17.1% is anticipated for 2024, bringing the net profit down to $346 million [6]. - The gross margin for 2023 was 59.3%, which is expected to improve to 60.0% in 2024 and remain stable in the following years [6]. - The company maintained a net debt level that is historically low, with a net leverage ratio of 1.58x [7]. Regional Performance Insights - In Q4 2024, the company's revenue decreased by 0.1% year-on-year to $940 million, but the gross margin improved by 0.3 percentage points to 60.2% [7]. - Revenue growth varied by region, with North America showing the most significant improvement at 11.7%, while Asia (excluding India) saw a decline of 1.6% [7]. - For Q1 2025, overall revenue is expected to decline in the mid to low single digits, with India projected to return to positive growth [7]. Store Expansion and Cash Flow - The company expanded its store count by 6.4% in 2024, with a net addition of 67 stores, primarily in Asia and Europe [7]. - Adjusted free cash flow increased by 9.3% to $310 million, with a total dividend and buyback amounting to $150 million and $160 million, respectively [7].

Financial Performance - For the fiscal year ending December 31, 2024, the company reported a net sales of $3,588.6 million, a decrease of 2.5% compared to $3,682.4 million in 2023[12]. - Gross profit for the same period was $2,152.2 million, down 1.4% from $2,182.8 million in the previous year, resulting in a gross margin of 60.0%[12]. - Operating profit decreased by 15.4% to $629.3 million from $743.7 million in 2023[12]. - Net profit for the year was $372.6 million, reflecting a decline of 13.4% compared to $430.3 million in 2023[12]. - Earnings attributable to equity holders were $345.6 million, down 12.9% from $396.9 million in the prior year[12]. - Adjusted net income was $369.8 million, a decrease of 5.8% from $392.4 million in 2023[12]. - Adjusted EBITDA for the year was $683.0 million, down 3.7% from $709.3 million in the previous year[12]. - The adjusted EBITDA margin was 19.0%, slightly lower than 19.3% in 2023[12]. - Basic earnings per share decreased by 13.0% to $0.239 from $0.275 in the prior year[12]. - Diluted earnings per share also fell by 13.1% to $0.237 compared to $0.273 in 2023[12]. Market Trends and Strategies - The company expects net sales growth at constant currency rates for Q1 and the full year of 2025, alongside strong profit margin maintenance[5]. - The company aims to expand its product portfolio and market coverage, including non-travel categories[5]. - The company is focusing on increasing sales in mature markets and deeper penetration in emerging markets with higher growth potential[5]. - The company reported a strong performance in its direct-to-consumer (DTC) channels, including the successful expansion of self-operated retail stores and e-commerce platforms[5]. - The company emphasizes its commitment to innovation in design and sustainability, aiming to differentiate its products[5]. - The company is actively managing its channel mix and executing a multi-channel strategy[5]. - The company is focused on maintaining its brand strength and attractiveness in the market[5]. - The company is aware of the potential impacts of travel industry trends, particularly in air travel, on its business[5]. - The company expects steady growth in the global travel and tourism industry in 2025, supporting consumer demand for its products[22]. Consumer Behavior and Market Challenges - The company experienced a decline in consumer sentiment in key markets, impacting discretionary spending on high-end and luxury brands, alongside reduced retail customer traffic[14]. - Competitive pressures, particularly from increased discounting by rivals in various markets, notably India, affected the company's performance[14]. - Strong global travel and tourism trends helped mitigate the macroeconomic challenges faced during the fiscal year ending December 31, 2024[14]. - The fiscal year 2023 saw sales driven by post-pandemic recovery in Asia, particularly after China lifted restrictions, and increased sales to wholesale customers in North America[14]. Financial Management and Cost Control - The company is committed to managing raw material supply and costs effectively[5]. - Marketing expenses decreased by $14.5 million or 6.0% to $227.0 million for the fiscal year ending December 31, 2024, with marketing expenses as a percentage of net sales declining by 30 basis points to 6.3%[15]. - General and administrative expenses are expected to decrease by $19.6 million or 7.8% from $250.2 million in 2023 to $230.7 million in 2024, with the percentage of these expenses to net sales dropping from 6.8% in 2023 to 6.4% in 2024[19]. - The company aims to maintain strong profit margins through strict expense management and leveraging high-margin brands and channels[37]. Shareholder Returns and Capital Management - The company repurchased 62,610,300 shares for a cash outflow of $157.6 million as part of its share repurchase program[15]. - The board recommends a dividend distribution of $150.0 million for 2025, with a payout ratio of 43.4%, compared to a payout ratio of 37.8% for the $150.0 million distribution in 2024[21]. - The company distributed $150.0 million to equity holders during the year, reflecting ongoing shareholder returns despite the decline in net profit[61]. - Dividends paid to non-controlling interests were $19.7 million in 2024, compared to $12.6 million in 2023, indicating an increase of approximately 56.7%[198]. Operational Performance - The company plans to expand its global retail store network from 1,052 stores as of December 31, 2023, to 1,119 stores by December 31, 2024, resulting in a distribution expense increase of $34.5 million or 3.4% to $1,062.1 million for 2024[19]. - The DTC sales net increased by 2.7% year-over-year, contributing 39.8% to total net sales, up from 38.9% in the previous year[18]. - The company opened 67 new retail stores in 2024, maintaining the same growth rate as in 2023, bringing the total to 1,119 stores[30]. Sustainability and Corporate Responsibility - The company increased the proportion of products made from recycled materials in its net sales to approximately 40% in 2024, up from 34% in 2023 and 23% in 2022, reflecting the growing importance of sustainability as a consumer purchasing driver[35]. - The company’s environmental, social, and governance rating was upgraded from "A" to "AA" by MSCI, and it ranked 40th in Time magazine's "World's Best Companies in Sustainable Growth 2025" list[35]. Future Outlook - The company anticipates a mid-single-digit decline in net sales for Q1 2025 compared to Q1 2024, due to macroeconomic uncertainties affecting consumer sentiment[36]. - The company plans to continue investing in marketing to upgrade the TUMI brand, celebrating its 50th anniversary with new product launches and marketing initiatives[36].

Investment Rating - The report initiates coverage with a "Buy" rating for Samsonite (1910.HK) [5] Core Views - Samsonite is the world's largest luggage company with a strong recovery post-pandemic, and it is expected to benefit from the overall recovery of the travel industry and macroeconomic improvements [5][3] - The company is focusing on multi-brand and multi-regional development, with significant growth potential in various markets [4][5] Company Overview - Samsonite was founded in 1910 and has grown to become the largest travel luggage company globally, with brands including Samsonite, Tumi, and American Tourister [10][11] - The company has seen revenue growth from $1.6 billion in 2011 to $3.6 billion in 2019, with a CAGR of approximately 11% [1][17] - In 2023, the company's revenue reached $3.7 billion, recovering to pre-pandemic levels, with profits hitting a historical high [17] Business Performance - For the first three quarters of 2024, the company's revenue decreased by 3% year-on-year, primarily due to weaker performance in the Chinese market and increased price competition in India [2][31] - The adjusted net profit for the same period decreased by 8.4% year-on-year, but the profit margin remains significantly better than pre-pandemic levels [2][41] Industry Logic - The global travel industry is expected to fully recover by the end of 2024, which will drive luggage consumption [3] - The global luggage market is projected to reach $160.4 billion in 2024, with a compound annual growth rate (CAGR) of 5.5% from 2024 to 2029 [3] - The industry is characterized by high concentration, with the top five luggage companies holding a market share of 30% in 2024 [3] Company Strategy - Short-term improvements are anticipated due to stimulus policies in China and promotional activities [4] - Long-term growth drivers include category expansion and regional penetration, with a focus on increasing the share of non-travel categories [4][5] - The company is also planning a dual listing outside of Hong Kong to improve stock liquidity [5] Financial Forecast - The adjusted net profit for 2024-2026 is projected to be $372 million, $407 million, and $428 million, respectively [6] - The adjusted EPS for the same period is expected to be $0.25, $0.28, and $0.29, with corresponding P/E ratios of 12x, 11x, and 10x, significantly lower than the average of comparable companies [5][6]

Core Viewpoint - UBS report indicates that Samsonite's stock price fell approximately 16% in 2023 primarily due to declining profits [1] Group 1: Financial Performance - The decline in stock price is attributed to a decrease in profits [1] - However, unfavorable factors affecting revenue in 2024 are expected to lessen, potentially improving business travel demand and driving profit recovery [1] Group 2: Future Outlook - A potential secondary listing in the U.S. could expand the shareholder base and facilitate a revaluation [1] - Since 2018, Samsonite has restructured its supply chain, with limited impact from Trump's tariff policies [1] Group 3: Target Price and Rating - UBS raised the target price from HKD 28 to HKD 29.8 while maintaining a "Buy" rating [1]

Investment Rating - The report assigns a "Neutral" rating for the company, indicating that the stock is expected to perform in line with the market over the next six months [174]. Core Views - The company is a global leader in the luggage industry, benefiting from the recovery of international tourism. It holds an 18% market share in the global luggage market and has shown a strong rebound in revenue post-pandemic, with a CAGR of 33.7% from 2020 to 2023 [4][5]. - The Asian market has surpassed North America in revenue contribution, with a significant growth rate of 55.8% in 2023, driven primarily by China, which saw a 78.7% increase [4][5]. - The company's core brands, including Samsonite, Tumi, and American Tourister, have all achieved double-digit growth, with Tumi leading at a 34.3% increase [4][5]. Summary by Sections Company Overview - The company, founded in 1910, is the largest luggage manufacturer globally, with a diverse brand portfolio that includes high-end and mid-range products [14][135]. - The company has undergone significant growth phases, including globalization and acquisitions, which have expanded its brand and product offerings [20][21][22]. Market Conditions - The global travel market is recovering, with key indicators like RPK and ASK returning to pre-pandemic levels, indicating a resurgence in travel demand [5][81]. - The luggage market is projected to grow, with an expected CAGR of 6.5% from 2021 to 2027, and the suitcase segment is anticipated to grow at a CAGR of 12% [5][99]. Growth Drivers - Domestic tourism in China has rebounded significantly, with a 93% increase in travel volume in 2023 compared to the previous year, contributing to the company's growth [7][143]. - The company is expanding its product range and innovating to attract younger consumers, with a focus on multi-functional travel products [7][156]. - Marketing strategies include celebrity endorsements and cross-brand collaborations, enhancing brand visibility and consumer engagement [8][169]. Financial Performance - The company's revenue reached $3.68 billion in 2023, surpassing pre-pandemic levels, with a notable recovery in profitability [36][63]. - The gross profit margin has improved, reaching 60% in the first half of 2024, reflecting strong operational efficiency [64][70]. Regional Performance - In 2023, the Asian market accounted for 38.8% of total revenue, overtaking North America, which dropped to 34% [41][42]. - China remains a critical market, contributing significantly to revenue growth, with a 79% increase in 2023 [45][151]. Brand Performance - Core brands have shown robust growth, with Samsonite generating $1.85 billion and Tumi achieving a 34.4% increase in revenue [49][50]. - The company is focusing on enhancing its brand portfolio to cater to diverse consumer needs across different price segments [135][138].