Misto Holdings (081660) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached KRW 1,175bn, up 2.5% YoY, with H1 2024 consolidated revenue at KRW 2,357.9bn, up 4.5% YoY, driven by strong performance in China, Korea, and Acushnet.

• Operating profit surged 52.4% in Q2 to KRW 140bn and reached KRW 303.4bn for H1, a 20.2% YoY increase.

• Net income attributable to controlling interests was KRW 100bn in Q2 (up 170% YoY) and KRW 128.1bn in H1, reflecting improved margins and absence of one-time costs in FILA USA.

• FILA Korea saw a 0.5% revenue increase and a 31.8% rise in operating profit, while FILA USA revenue declined 16.6% due to a competitive US market and discounting.

• Acushnet maintained strong brand momentum, with Q2 revenue of USD 684mn (-0.8% YoY) and H1 revenue of KRW 1,877.7bn, supported by Titleist golf balls.

Financial highlights

• Consolidated gross margin improved to 53.0% in Q2 and 39.7% in H1, both up YoY.

• FILA Korea's gross margin rose to 66.0%, and operating margin to 20.1%.

• FILA USA turned gross profit positive but posted an operating loss of KRW 29bn.

• H1 EPS was 2,135 KRW, up from 906 KRW YoY.

• Global royalty income fell 12.6% YoY, with declines across all regions, notably EMEA (-17.5%) and North America (-24.7%).

Outlook and guidance

• 2024 consolidated revenue growth target remains -5% to +5% YoY, with operating profit expected to rise 30–40% YoY.

• FILA USA and FILA Korea expected to post operating losses in 2024, while royalty income is projected to decline 10–20%.

• Ongoing execution of 5-year strategy 'Winning Together' with focus on brand value, customer centricity, and sustainability.