On Holding AG

Ladies and gentlemen, thank you for standing by. Welcome and thank you for joining the On Holding AG Q4 and Full Year 2021 results. Throughout today's call, all participants will be in a listen-only mode. The presentation will be followed by a question and answer session. If you would like to ask a question, you may press star followed by one on your touchtone telephone to register for questions. Please press the star key followed by zero for operator assistance. Now I'd like to turn the conference over to Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations.

Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag, Head of Investor Relations. Please go ahead. Florian Maag Afterwards, we are looking forward to opening the call for a Q&A session. Before we begin, I would like to remind everyone that the remarks during today's call may contain forward-looking statements regarding future events and financial performance within the meaning of the federal securities laws. These forward-looking statements reflect our current expectations and beliefs only, and such statements are subject to certain risks and uncertainties that could cause actual results to differ materially. Please refer to our 20F filed with the Securities and Exchange Commission earlier this morning for a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Please further note that this call will also contain certain non-EFRS financial measures, such as adjusted EBITDA and adjusted EBITDA margin. While the company believes these non-IFRS financial measures will provide useful information for investors, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with IFRS. Please refer to today's release for a reconciliation of non-IFRS financial measures to the most comparable measures prepared in accordance with IFRS. With that, I will turn the call over first to David, followed by Martin for the prepared remarks.

A warm welcome to all of you joining us today around the world from Switzerland. We are excited to share with you ON's first full year results as a public company after our successful IPO just six months ago. We thank you very much for following our journey and for tuning in today. You will hear about recent progress and important priorities before we dive more deeply into financials, conclude with an outlook on 2022 and then open up to your questions global consumer demand continues to drive on hyper growth we are very pleased to announce that 2021 has been the strongest year in on 12th year history and beats our expectations at the beginning of last year on all accounts we experienced strong global consumer demand across all regions, channels, and product categories. The exceptional momentum lifted net sales to 725 million Swiss francs, representing a 70% year-over-year growth. At the same time, we see a significant jump in ONZE cross-profit margin to the top end of our industry and continued increase in adjusted EBITDA. We are grateful to have successfully navigated the uncertainties of the global pandemic and supply chain restrictions in the last two years. I feel it shows the strength of the on-brand, of our operating model, and most importantly, of our global team. On the supply side, on strong consumer demand is met with better than expected product availability. Some of the brightest members of our team work in supply planning. Their agility and the strong relationships with our suppliers made it possible to mitigate the temporary stop of production in Vietnam in a short amount of time. Of course, COVID is not over. A war in Europe is not just a human tragedy, but could have ramifications in global trade. And inflation is a challenge to consider. We remain on the lookout, vigilant to take on risks as they arise. Risk awareness has served us well in the first thousand years of an incredible journey. Still, we continue to be very optimistic. ON is experiencing a running boom everywhere. Markets like the US, the UK, and China are taking off like never before, and we see strong growth across all regions. The ON brand truly is on fire. Take the US, where ON saw over 92% growth in run specialty and also over 85% in our own eco. Take the UK, where ON grew over 75% in 2021. Or take China, where ON jumped from rank 120 to 35 in the Tmall sports ranking and sees a five-fold increase in brand followers. The momentum of performance brand ON is further fueled by athletes. As you know, ON has been founded by athletes for athletes. We are all inspired by ON athletes who turn their dreams into reality. They truly are on a winning streak across the globe. The On Athletics Club, or shorthand OAC, is ON's elite athlete team based and trained in Boulder, Colorado. We are honored to announce that the two-time 5,000-meter world champion, Helen O'Berry, is joining the On Athletics Club. Helen is one of the most impressive and versatile female athletes. She will move with her family to the U.S. to join the On Athletics Club in Boulder to train with our coach, Jason Ritzenhain, and the OAC team. Many of the OAC athletes have competed in last year's Olympics and continue to stun audiences. Like Australian Olympian Ollie Hoare, who won the fastest mile at the Millrose Games in New York City with a striking time of 3 minutes and 50 seconds. We could not be happier about the success of our athletes and the On Athletics Club. This is why we have decided to establish OAC in Europe and Oceania as well this year. Over in Europe, our athletes from the Swiss Alps have just come home from the most successful Winter Olympics for Switzerland ever. And the Norwegian Olympics team has won the most medals of all nations in this year's Winter Olympics. ONN has been developing shoes and apparel for both teams in the last years and is their official sponsor. Seeing ONN athletes spin across the globe fuels the momentum of ONN as a unique performance brand. We further amplify through broad storytelling in feature-length film and short social stories. I am sure you are targeted as well by our data engine. We are making fast progress towards our long-term brand mission to ignite the human spirit through movement. ON is carried by a rapidly increasing movement of millions who run, explore, travel near and far, lift their spirit and dream ON. This means that ON is reaching a far broader community. ON's brand and products resonate with a bigger market in three ways. First, we are launching exciting products for all type of runners. As an innovation brand, we are building on our technology for world champions and make it vitally relevant for all runners. Just two examples of a record launch of all six new shoe models. Let me just give you two examples out of six all new shoe models. In running, the all-new CloudMonster model will launch this spring and is celebrated by our retailers, who serve the big group of everyday runners. These are runners who demand maximum cushioning. For outdoor retailers, we launched the all-new CloudVista. It is the perfect companion for gravel roads and tracks, versatile and mainstream. At the same time, we see our apparel range growing nearly twice as fast as our shoes. ONCE Innovation Drive is awarded by our industry. Footwear News has named ONCE the 2021 brand of the year back in November. And ISPO, the biggest European sportswear, has given the 2022 ISPO award to our new Xero jacket in apparel and to the all-new Cloud Monster in footwear. My second point is that we see a run culture crossing over into popular culture. A young community in Tokyo, Shanghai, London, and New York has embraced On as a brand that inspires them at the intersection of performance and design. On the fly is off the shelves at tastemaker retail and the select shady and footlocker doors where we choose to play. On performance shoes and apparel pieces pop up in the streets well beyond the running routes. And we believe that ONTAP's into a secular shift where performance is taking over fashion and replaces classical archetypes with performance silhouettes. Driven by this shift, Loewe, one of the fastest-growing global fashion brands and the rising star in the LVMH universe, has asked us to collaborate with them on performance silhouettes. Two years in the making, the unique capsule of enjoues and apparel pieces has launched just last week. Available in all Loewe flagships in select fashion retail and on our website. Days after launch, the collection is almost sold out. Loewe runs a global campaign and especially caters to an intense brand loss in Asia with more than 40 flagship locations. This all means that ON stays firmly rooted in run culture and at the same time is embraced by a much wider market and demographic. And an important third point is that we believe that all communities have a fundamental right to movement. This inspired the launch of our Right to Run social impact program in early 2021. Through partnerships with community organizers and nonprofits around the world, We promote access and inclusion in running. Sometimes it is as basic as having a safe route to run. Together with our partners, we are empowering communities that are at the risk to be left out of the global running community, such as people with disabilities and people of color or those who are experiencing houselessness. We are committed to ignite the human spirit through movement in all parts of society. Now, let me speak to our omnichannel strategy that is so vital to our success. We are not only creating products that our customers love, but also reach them where they shop. ON's omnichannel strategy is firing on all cylinders. It delivers scale, insight, as well as resilience for ON in the following ways. Our own e-comm channel on our website has reached a high share of 36% of our business in 2021. This means that we increase direct connections to our community, now serve customers in 48 countries through D2C, and learn from them. For example, customers who buy apparel as a first piece show a higher lifetime value as they already appreciate on as a sports brand, not a pure shoe brand. And predicting the relevant offering to the right customers at the right time in their journey has allowed us to retain big new customer cohorts. In fact, in the last two years, we have retained our newest customers with a similar stickiness as customers who have come to us when ON was still a smaller brand. This means that ON stays very relevant while we reach a far wider audience. It also shows that running habits that were formed in the pandemic persist. The benefits of this very data-driven approach obviously extends to demand planning and operational effectiveness and, of course, also gives us higher margins. At the same time, we continue to build strong relationships with our wholesale partners. We believe that retail partners with strong brands and a unique offering will continue to add value to their customers in physical locations as well as on digital channels. They inform and inspire beyond the transaction. We are fortunate that strong wholesale brands have partnered with us for years and continue to introduce and position our brand to their unique audience. To mention a few activation highlights with our key wholesale partners, With REI, for example, we exclusively pre-launched the Cloud Ultra as a top trail running shoe to their community of 20 million outdoor enthusiasts. A huge win for building ONCE credibility in the outdoor space. Our fast success at Nordstrom paves the way for roughly 20 additional shopping shops in important Nordstrom doors this year. and the focus on the best footlocker doors introduces on to an even younger audience. At the same time, we have open shopping shops in some of the most premium locations on this planet, at Beaumarchais in Paris and at Harrods in London. These initiatives allow us to grow fast on a global scale in more than 8,700 doors and hundreds of city centers. At more than 1,000 locations, ON is present with a branded drop-in-drop experience. In 2021, we have observed consumers flooding back to the city centers and stores after lockdowns, eager for interaction and experience. As a result, we have seen wholesale revenues bouncing back strongly, keeping our omni-channel mix with D2C very resilient. This has strengthened our belief that attractive physical shopping experiences continue to be an important part of consumer culture and part of the very fabric of our cities. The importance of physical experiences is as well the backdrop for our expansion of our very own retail network in global hub cities. ON flagships act as the most complete experience community center and media channel for our brand. ON New York City is experiencing waiting lines in front of the door, and many community runs start from the space. New York and our eight ON flagships in China are able to attract the highest share of first-time customers to ON across all our channels. Conversion in store is higher than any other sales channel, with a significant share of apparel in some stores up to 25% of sales. All of our stores have reached profitability within nine short months of opening. We will continue to expand to the most important cities on this planet. At the heel of the Tokyo Olympics last year, OnTokyo is set to open in the next weeks, followed by London, and Zurich in summer. It is important for you to know that we are not seeing a cannibalization of our wholesale and D2C channels. Both channels show sustained strong growth at the same time and are highly complimentary. Let me come to the ultimate success factor of all, our team. We are fortunate that ONN has been able to attract exceptional talent. Only 1% of all people who apply at ONN are accepted. In 2021, ONN has grown to 1,100 members who dream ONN and build the future. 600 people have joined Team ONN in the last two years and have mostly worked remotely. The ON team comes from over 65 nationalities and very different backgrounds and mindsets. We see diversity as a catalyst for innovation and creativity. These months, we are seeing an important moment for ON, where the team is moving back together into new social office and lab spaces. Our European technology hub in Berlin was just opened in a big former post office and brings together 200 tech and customer service people. Our new North America home in Portland will see 300 people move in together in April, and 700 people will move into the new OnLabs in Zurich in summer. The team will continue to have the opportunity for hybrid work, but also come together in social spaces again. Nobody is coming back to the office just for a desk. We will continue to build a unique ON Culture along our five spirits and join many RONs along the way together. This will bring collaboration, community activities, and workplace innovation to the next level at ON. When we speak of RON Culture and our team, I have to mention the most important member of our community, our planet. Nature is the most important environment for sports and exploration, but also the most endangered one. So in the next earnings call, we will talk about our important green tech initiatives, Cyclone and CleanCloud. So stay tuned. And with this, I'm handing over to Martin on CFO and Co-CEO to take you on a financial deep dive.