Capital risk management

12 Months Ended

Dec. 31, 2024

Disclosure of Financial Risk Management [Abstract]

Capital risk management

5 Risk management

On is exposed to market risk, foreign currency risk, credit risk and liquidity risk. On’s senior management oversees and monitors these risks supported by the Audit Committee that assures proper identification, measurement and management of these financial risks by implementing and maintaining a financial governance framework. The Audit Committee reviews and agrees policies for managing each of these risks at least once a year.

5.2 Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. On’s exposure to the risk of changes in foreign currency rates is a direct result of multi-currency cash flows within the company. The majority of our transactional foreign exchange risk arises from products sourced in USD and sales denominated in the currencies of the respective destination markets. The currencies in which these transactions are mainly denominated are USD, EUR, CAD, CHF, GBP, JPY, CNY, BRL, AUD and HKD.

On regularly assesses its exposure to foreign currency risks and manages these risks centrally by reviewing foreign exchange exposures and future commitments, and selectively holding foreign currency in our cash to offset future foreign currency exposures (e.g., lease obligations). Additionally, to the extent practicable, we centralize foreign currency risk in our main Group entities, and incur operating and financing expenses in the local currencies of the countries in which we operate. Additionally, we have in the past, and may again in the future, enter into derivative financial instruments, such as forward exchange contracts, to further manage our foreign currency risk.

The following table sets forth the foreign exchange rate against the Swiss Franc at the closing dates:

Currency	12/31/2024	12/31/2023
AUD 1	0.56	0.57
BRL 100	14.64	17.32
CAD 1	0.63	0.63
CNY 100	12.44	11.85
EUR 1	0.94	0.93
GBP 1	1.14	1.07
JPY 100	0.58	0.60
HKD 1	0.12	0.11
USD 1	0.91	0.84

The following table sets forth the average annual foreign exchange rate against the Swiss Franc:

Currency	12/31/2024	12/31/2023	12/31/2022
AUD 1	0.58	0.61	0.67
BRL 100	15.36	18.16	18.49
CAD 1	0.63	0.68	0.74
CNY 100	12.33	13.03	14.46
EUR 1	0.95	0.99	1.02
GBP 1	1.14	1.13	1.20
JPY 100	0.58	0.66	0.75
HKD 1	0.11	0.12	0.13
USD 1	0.88	0.92	0.96

Accounting policies On’s consolidated financial statements are presented in CHF, which is On’s presentation currency. On determines the functional currency of each individual entity based on the primary economic environment in which the entity operates (normally the local currency). The financial statements of each individual entity are measured using that functional currency.
Foreign currency transactions are translated into the respective functional currency using the average monthly exchange rate of the month in which the transaction occurred. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the exchange rate at the reporting date. The resulting exchange differences are recorded in the local income statements of the group entity and included in the financial result.
Foreign currency exchange differences arising from intercompany receivables or payables relating to foreign operations, the settlement of which is neither planned nor likely to occur in the foreseeable future, are considered to form part of net investment in foreign operations and are recognized in the foreign currency translation effect reserve.
Non-monetary items that are measured based on historical cost in a foreign currency are translated using the historical exchange rate.
The group entities’ foreign currency financial statements are translated into On’s presentation currency CHF as follows: •Assets and liabilities for each balance sheet presented are translated at the closing exchange rates at the reporting date. •Income and expenses for each statement of profit or loss and statement of comprehensive income are translated at average exchange rates. •All resulting foreign currency translation effect are recognized in other comprehensive income in equity. •On disposal of a group entity, the related cumulative translation adjustment is transferred from equity to the income statement.

Financial assets and liabilities held in foreign currencies as of December 31, 2024 and 2023, were as follows:

(CHF in millions)	12/31/2024		12/31/2023
	USD	EUR	USD	EUR
Cash and cash equivalents	629.3	24.1	248.7	69.8
Trade receivables and other financial assets(1)	229.6	34.5	640.0	102.1
Trade payables and other financial liabilities(1)	(145.3)	(21.4)	(257.6)	(84.5)
Total assets and liabilities	713.6	37.2	631.2	87.4

(1) The majority of these balances are comprised of intercompany positions.

As a result of our multinational sales and operations, On is exposed to fluctuation in foreign exchange at a transactional level, primarily in the U.S. Dollar and the Euro. A change in the foreign exchange rate of the Swiss Franc against the U.S Dollar or the Euro, as of December 31, 2024, 2023 and 2022, would have affected the valuation of assets and liabilities denominated in these foreign currencies. This analysis assumes that all other variables remain constant. The exposure is disclosed net of income tax and excludes the impact of derivative financial instruments. A 10% increase or decrease in the USD or EUR foreign currency exchange rates against the Swiss Franc would have impacted On's consolidated profit/(loss) for the period as presented below.

(CHF in millions)	12/31/2024	12/31/2023	12/31/2022
Change in USD/CHF +10%	57.4	71.2	32.1
Change in USD/CHF -10%	(57.4)	(71.2)	(32.1)
Change in EUR/CHF +10%	3.0	7.3	1.1
Change in EUR/CHF -10%	(3.0)	(7.3)	(1.1)

5.5 Capital risk management

To uphold investor, creditor, and market confidence and to sustain future development of the business, On focuses on maintaining a strong capital base. On manages its capital structure and makes adjustments in line with changes in general economic conditions and according to its strategic objectives.