The sporting goods industry is expected to grow at 6-7% p.a. over the next few years, driven by secular trends:
- Athleisure: a global fashion trend towards more casual dress
- Health & Wellness: growing awareness on improving health and quality of life, further increased by the radical changes within the global society resulting from the Covid-19 pandemic
- Boom in sport and sportswear adoption in China.
adidas is a strong brand in the design and distribution of sporting goods, (i) #1 in Europe and #2 worldwide and (ii) supported by strong innovation capability throughout multiple sponsorship agreements.
There is potential for growth in sales, mainly supported by:
- Digital: strong increase in e-commerce sales, accelerated throughout 2020 by the transformation of our economy and further adoption of online shopping and remote working under the effects of the Covid-19 lockdowns
- Omni-channel approach: strong sales dynamics from both e-commerce and “own stores” (Direct-to-Consumer model)
- The Chinese market, which has experienced strong momentum over the last few years
- The increasing share of ‘‘sport-inspired’’ lifestyle products in adidas’ product range
- The US market, where further market share gains are possible
- Speed initiatives: clear objectives to reduce the time-to-market of products.
Potential for EBIT margin improvement is driven by (i) the ongoing disposal of the Reebok brand, (ii) cost efficiency / overhead optimization mainly through economies of scale and (iii) increased profitability in the USA. Solid balance sheet with strong cash conversion allows for attractive shareholders’ remuneration.
- Supervisory Board General Committee Nomination committee Mediation Committee