Adidas Ag · XETR:ADS
Adidas — adidas-Salomon — H1 2005 Earnings Presentation
16 slides from Adidas's earnings presentation, Aug 3, 2005
Slide 1: First Half Year 2005 Financial Results Presentation
adidas-Salomon AG FIRST HALF YEAR 2005 FINANCIAL RESULTS PRESENTATION 3 August 2005
Slide 2: Excellent First Half Year Results
Excellent First Half Year Results Currency-neutral sales grow 11% Gross margin grows 50bps to 48.5% Operating profit up 26%, with operating margin at record 11.2% Net income attributable to shareholders from continuing and discontinued operations increases 48% 2
Slide 3: Double-Digit Currency-Neutral Sales Increased in Q2
Double-Digit Currency-Neutral Sales Increased in Q2 Quarterly Currency-Neutral Sales (€ Million) 2,000 1,800 13% (11%) 10% 1,600 (8%) 1,400 1,200 1,000 800 2004 2005 2004 2005 2004 2004 Q1 Q2 Q3 Q4 Note: Figures in brackets in euro terms 3
Slide 4: YTD Double-Digit Top-Line Growth Driven by adidas and TaylorMade-adidas Golf
YTD Double-Digit Top-Line Growth Driven by adidas and TaylorMade-adidas Golf % of Total 10% 88 (9%) 19% 12 (16%) 100 11% Group(1) (10%) Total: €3,189m Note: Figures in brackets in euro terms (1) Continuing operations 4
Slide 5: Outstanding Regional Performance
Outstanding Regional Performance Currency-Neutral Sales Operating Profit Europe + 1% + 18% North America + 18% + 234% Asia + 30% + 59% Latin America + 36% + 55% 5
Slide 6: Gross Margin at Record Level for First Half Year
Gross Margin at Record Level for First Half Year 45.6% Ï 180bps 46.6% Ð 90bps Group(1) 48.5% Ï 50bps (1) Continuing operations incl. HQ/consolidation 6
Slide 7: Operating Expense Leverage Supports Significant Operating Margin Improvement
Operating Expense Leverage Supports Significant Operating Margin Improvement Operating expenses as percentage of net sales decreased Operating profit up 26% to €357 million (+ 19% on a comparable basis) Operating margin increased 1.5 percentage points to 11.2% (+ 0.8 percentage points on a comparabl
Slide 8: Exceptional Operating Performance Drives Strong Bottom-Line Profitability
Exceptional Operating Performance Drives Strong Bottom- Line Profitability Financial expenses reduced by 32% IBT grew 33% to €337 million (+ 24% on a comparable basis) Net income from continuing operations increased 25% on a comparable basis Loss from discontinued operations increased by 20% to €49
Slide 9: Tight Working Capital Management Remains Key
Tight Working Capital Management Remains Key Receivables from continuing operations reduced by 3% currency-neutral (-1% in euros) ● Driven by trade terms management and concerted collection efforts Inventories from continuing operations increased 4% on a currency-neutral basis (+5% in euros) ● Signi
Slide 10: Significant Financial Leverage Improvement Reflects Excellent Financial Health
Significant Financial Leverage Improvement Reflects Excellent Financial Health 2,000(1) Group debt reduced by €425 million vs. the prior year 1,500(1) Main drivers: strong bottom-line profitability, tight working capital management 1,000(1) Financial leverage decreased to 29% 500(1) Shareholders’ eq
Slide 11: Gearing Up for Second Half Excitement
Gearing Up for Second Half Excitement World Track and Field Championships in Helsinki Continuing market share gains in North America Salomon sale to be completed Major basketball launches for T-MAC and Kevin Garnett WORLD CUP FEVER BEGINS! 11
Slide 12: Strong Footwear Backlogs Support Continuously Positive Order Book (YOY)
Strong Footwear Backlogs Support Continuously Positive Order Book (YOY) Euros Currency-Neutral Footwear + 11% + 11% Highest currency-neutral footwear backlogs in two years Apparel + 9% + 8% 12th consecutive quarter Total + 10% + 9% of currency-neutral apparel backlog growth 12
Slide 13: European Backlogs Slightly Up Driven by Footwear (YOY)
European Backlogs Slightly Up Driven by Footwear (YOY) Euros Currency-Neutral Footwear + 9% + 9% Growth in footwear backlogs driven by Sport Heritage Apparel - 2% - 3% Apparel market remains Total + 3% + 2% challenging 13
Slide 14: Significant Backlog Growth in America Driven by Apparel and Footwear (YOY)
Significant Backlog Growth in America Driven by Apparel and Footwear (YOY) Euros Currency-Neutral Footwear + 9% + 8% 7th consecutive quarter of sequential backlog improvement Apparel + 10% + 9% Growth drivers: Total + 10% + 9% basketball, tennis and Sport Heritage 14
Slide 15: Asian Backlog Momentum Remains Strong (YOY)
Asian Backlog Momentum Remains Strong (YOY) Euros Currency-Neutral Footwear + 21% + 19% 16th consecutive quarter of double-digit underlying backlog growth Apparel + 38% + 36% Driven by China and Total + 31% + 29% Japan 15
Slide 16: Full Year Guidance Confirmed
Full Year Guidance Confirmed Currency-neutral sales growth mid-to-high-single-digit Gross margin ca.48% Operating margin ca.11.0% Net income attributable to shareholders from continuing and discontinued operations ca.20% 16