Investment Rating - The report assigns a rating of "Outperform" for Samsonite, indicating an expected total return over the next 12-18 months that exceeds the return of its relevant broad market benchmark [20]. Core Insights - Samsonite's 1Q25 revenue and profit performance were under pressure, with net sales declining 4.5% year-on-year to $797 million, primarily due to weak demand in North America and China, along with a high base from the previous year [2][9]. - The company aims to maintain gross margin levels despite challenges, with a gross margin of 59.4% in 1Q25, down 100 basis points year-on-year [2][9]. - Adjusted EBITDA decreased by 20.9% year-on-year, reflecting negative leverage effects from lower gross margins and sales, resulting in an adjusted EBITDA rate of 18.8% [2][9]. - Adjusted net income fell by 40.3% year-on-year, driven by the decline in adjusted EBITDA, increased depreciation, net interest expense, and a higher effective tax rate [2][9]. - The company reported a negative adjusted free cash flow of $41 million in 1Q25, attributed to the decline in EBITDA and an increase in net working capital [2][9]. Revenue Performance by Region - Sales in Asia and North America were weak, with Asia revenue down 7% year-on-year, and North America revenue declining 8% [3][10]. - European sales continued to show strong growth, with a 4.4% year-on-year increase, supported by positive growth across all core brands [3][10]. - Latin America sales remained flat year-on-year, with a notable decline in Mexico due to lower consumer confidence [3][10]. Channel Performance - The Direct-to-Consumer (DTC) channel performed well, accounting for 38.2% of revenue in 1Q25, with e-commerce contributing 10.6% and offline retail 27.5% [4][11]. - The offline retail business saw a decline of 2.6%, primarily due to reduced customer traffic, while wholesale business declined by 6.1% year-on-year [4][11]. Tariff Policy and Mitigation Strategies - The U.S. tariff policy remains unclear, causing caution among consumers and wholesale customers [5][12]. - The company has reduced its sourcing from China to 14% and plans to further decrease this by year-end, leveraging a diversified sourcing platform to mitigate potential tariff impacts [5][12]. Future Guidance - Management expects 2Q25 net sales growth to be similar to 1Q25, with net revenue guidance down mid-single digits on a constant currency basis [6][13]. - Long-term growth is anticipated to be supported by strong travel trends, despite short-term macroeconomic uncertainties affecting consumer demand [6][13].
新秀丽（01910）：1Q25收入和利润表现均承压，2Q25净收入指引下跌中单位数