Adidas Ag · XETR:ADS
Adidas — adidas-Salomon — CA Cheuvreux 4th German Corporate Conference 2005
30 slides from Adidas's conference presentation, Jan 19, 2005
Slide 1: CA Cheuvreux 4th German Corporate Conference
adidas-Salomon AG CA Cheuvreux 4th German Corporate Conference January 19, 2005 Robin Stalker, CFO
Slide 2: Agenda
adidas-Salomon AG 4th German Corporate Conference January 2005 Agenda • adidas-Salomon overview • Group strategic priorities 2004-2008 • Brands and regions • Group outlook 2
Slide 3: Currency-Neutral adidas-Salomon Sales Increase 5% in 2003
adidas-Salomon AG 4th German Corporate Conference January 2005 Currency-Neutral adidas-Salomon Sales Increase 5% in 2003 …by brand …by region TaylorMade- North Salomon adidas Golf America 11% 10% 25% Asia adidas Europe 18% 54% Latin 79% America 3% 3
Slide 4: Consumer-Group Oriented Structure
adidas-Salomon AG 4th German Corporate Conference January 2005 Consumer-Group Oriented Structure Consumer fashion-conscious sports lifestyle performance freeride golfers consumers consumers athletes athletes Focused Resources Marketing Operations Sales 4
Slide 5: Solid YTD Performance
adidas-Salomon AG 4th German Corporate Conference January 2005 Solid YTD Performance • Currency-neutral sales up 6% (+3% in euros) • Gross margin increases 330 basis points to 47.4% • Operating profit grows 22%, operating margin at 10.9% • Net debt reduced by € 510 million • Currency-neutral backlog
Slide 6: Agenda
adidas-Salomon AG 4th German Corporate Conference January 2005 Agenda • adidas-Salomon overview • Group strategic priorities 2004-2008 • Brands and regions • Group outlook 6
Slide 7: Group Strategic Priorities 2004-2008
adidas-Salomon AG 4th German Corporate Conference January 2005 Group Strategic Priorities 2004-2008 • Maximizing brand image and value • Growing the top line • Driving operating margin improvement • Increasing returns to shareholders 7
Slide 8: Utilizing Major Sporting Events
adidas-Salomon AG 4th German Corporate Conference January 2005 Utilizing Major Sporting Events 8
Slide 9: Ongoing Brand-Building Activities
adidas-Salomon AG 4th German Corporate Conference January 2005 Ongoing Brand-Building Activities 9
Slide 10: Continued Innovation Leadership
adidas-Salomon AG 4th German Corporate Conference January 2005 Continued Innovation Leadership At least one major technological innovation per year between 2005 and 2008 10
Slide 11: Partnering with the World's Leading Athletes
adidas-Salomon AG 4th German Corporate Conference January 2005 Partnering with the World’s Leading Athletes 11
Slide 12: Accelerating Top-Line Growth
adidas-Salomon AG 4th German Corporate Conference January 2005 Accelerating Top-Line Growth • Market conditions aren’t getting any easier • Key account focus • Own-retail initiatives • Focus on under-penetrated consumer groups (e.g. women) 12
Slide 13: Driving Operating Margin Improvement
adidas-Salomon AG 4th German Corporate Conference January 2005 Driving Operating Margin Improvement • Increasing efficiency drives cost side progress Ö Major contracts as profit centers • 10% operating margin target in 2006 Ö Profitability gains to continue in Europe Ö Strong top- and bottom-line gr
Slide 14: Increasing Shareholder Returns
adidas-Salomon AG 4th German Corporate Conference January 2005 Increasing Shareholder Returns • Strong operational performance to drive continued capital gains • Increasing dividends for 2004 and beyond • Convertible bond now “in the money” 14
Slide 15: Agenda
adidas-Salomon AG 4th German Corporate Conference January 2005 Agenda • adidas-Salomon overview • Group strategic priorities 2004-2008 • Brands and regions • Group outlook 15
Slide 16: adidas in the Coming Years
adidas-Salomon AG 4th German Corporate Conference January 2005 adidas in the Coming Years • Utilize upcoming events to create excitement around the brand • Football sales to reach € 1 billion in 2006 • Continue “Apparel Breakthrough” initiative • Further own-retail roll-out Focus on long-term, profi
Slide 17: Salomon's Path to Success in 2005-2007
adidas-Salomon AG 4th German Corporate Conference January 2005 Salomon’s Path to Success in 2005-2007 • Strong growth of soft goods product lines • “Women Will” consumer communication and retail solutions • Margin improvement through manufacturing and sourcing optimization Improving profitability is
Slide 18: TaylorMade-adidas Golf in the Next Three Years
adidas-Salomon AG 4th German Corporate Conference January 2005 TaylorMade-adidas Golf in the Next Three Years • Continue metalwood dominance • Become #1 in irons • Double-digit growth in Asia and at adidas Golf Innovative products continue to fuel growth 18
Slide 19: European Core Levers for Growth in 2005 / 2006
adidas-Salomon AG 4th German Corporate Conference January 2005 European Core Levers for Growth in 2005 / 2006 Football Key Accounts Running Own Retail Apparel Emerging Markets 19
Slide 20: Five Major Initiatives in North America
adidas-Salomon AG 4th German Corporate Conference January 2005 Five Major Initiatives in North America • Create excitement around brand adidas • Extend strong global sports marketing foundation into US sports • Establish product leadership in the USA • Improve presence at the point of sale • Optimiz
Slide 21: Major Growth Engines/Strategies in Asia
adidas-Salomon AG 4th German Corporate Conference January 2005 Major Growth Engines/Strategies in Asia • Retail expansion & development • Increase sell-through at POS • Maximize opportunities of incremental sales (e.g. major sporting events) • Growth management 21
Slide 22: Agenda
adidas-Salomon AG 4th German Corporate Conference January 2005 Agenda • adidas-Salomon overview • Group strategic priorities 2004-2008 • Brands and regions • Group outlook 22
Slide 23: adidas-Salomon on Track for Improved 2004 Targets
adidas-Salomon AG 4th German Corporate Conference January 2005 adidas-Salomon on Track for Improved 2004 Targets • Currency-neutral sales growth of around 5% • Gross margin to clearly exceed 45% • Earnings to grow by around 20% 23
Slide 24: Strong Basketball Line-Up
adidas-Salomon AG 4th German Corporate Conference January 2005 Strong Basketball Line-Up • T-MAC 4 follow-up in February • GDL in stores now with strong sell-throughs • a³ Garnett 2 available in February 24
Slide 25: adidas by Stella McCartney
adidas-Salomon AG 4th German Corporate Conference January 2005 adidas by Stella McCartney • First sports performance designer collection for women • Products in four sports categories • High-end department stores as US distribution focus 25
Slide 26: Ali by adidas
adidas-Salomon AG 4th German Corporate Conference January 2005 Ali by adidas • Complete range of men’s Ö Apparel Ö Footwear Ö Accessories • Debut in spring/summer 2005 26
Slide 27: adidas_1
adidas-Salomon AG 4th German Corporate Conference January 2005 adidas_1 • First shoe to feature intelligent cushioning by automatically and continuously adjusting itself • On sale in spring 2005 • Retail price at $ 250 / € 250 27
Slide 28: adidas-Salomon Establishes Sponsored ADR Program in the US
adidas-Salomon AG 4th German Corporate Conference January 2005 adidas-Salomon Establishes Sponsored ADR Program in the US • ADRs trade on the over-the-counter market • Symbol: ADDYY • ADR ratio 2:1 Ö i.e. one ADR represents one-half of one common share of adidas-Salomon • Depositary: The Bank of New
Slide 29: 2005 Outlook
adidas-Salomon AG 4th German Corporate Conference January 2005 2005 Outlook • Mid- to high-single-digit currency-neutral sales growth • Continued strong gross margins • Operating margin improvement • 10-15% earnings improvement 29
Slide 30: Questions and Answers
adidas-Salomon AG 4th German Corporate Conference January 2005 QUESTIONS AND ANSWERS 30
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