adidas AG / adidas Group to accelerate growth until 2020 .
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FOR IMMEDIATE
RELEASE
Herzogenaurach, March 26,
2015
adidas Group to
accelerate growth until 2020
-
Group currency-neutral sales to grow at a
high-single-digit rate on average per year until 2020
-
Growth strategy with clear focus on speed,
cities and open source
-
Net income to increase around 15% per year on
average
-
Group increases targeted dividend payout ratio
to 30%-50%
Herzogenaurach,
Germany - At its Investor Day in Herzogenaurach, the adidas
Group today presented its new strategic business plan until the
year 2020. By 'creating the new', the strategy aims at further
accelerating growth by significantly increasing brand desirability.
This is expected to spur top- and bottom-line growth, with revenues
projected to increase at a high-single-digit rate on average per
year on a currency-neutral basis until 2020 compared to the
expected 2015 results. The Group's net income is expected to grow
at a considerably higher rate than the top line and is projected to
expand by around 15% on average in each of the next five years.
The new business plan is built
around three major strategic choices: speed, cities and open
source.
Speed
With adidas NEO, the Group has
already set new standards with regard to speed to market by
significantly reducing production lead times and increasing
in-season creation. Drawing on these successful experiences, the
company intends to roll out this mantra of 'speed' across the
entire Group. To complement this, the adidas Group will further
increase its sales through controlled space activities to above 60%
of sales. At the same time, the Group aims to expand its eCommerce
business to above € 2 billion by 2020, by implementing a true
omni-channel approach. Further, the company is going to evolve
production capabilities to dramatically expand product
customisation options for its consumers.
"We are living in a fast-changing
world. Only what is new is relevant to the consumer. Therefore, we
have to relentlessly focus on 'creating the new' for our consumers.
And we have to constantly re-invent ourselves as an organisation to
lead the change in our industry," said Herbert Hainer, adidas Group
CEO. "Going forward, speed will be a key competitive advantage for
us as we transform the adidas Group into the first true fast sports
company."
Cities
With 80% of global GDP generated
in cities and global trends being increasingly shaped in
metropolitan areas, the adidas Group aims to continue its growth in
all relevant geographic markets with a focus on six global key
cities: Los Angeles, New York, London, Paris, Shanghai and Tokyo.
Across these cities, the adidas Group will over-proportionally
invest in talent, attention and marketing spend.
"Global brands are created in
global cities," said Roland Auschel, Executive Board Member
responsible for Global Sales. "If we win running in New York and
Los Angeles, we will win running in the US. Therefore, we are
committed to win market and mind share in key cities around the
globe."
Open
source
In order to capture growth
opportunities even more effectively than before, the adidas Group
will focus investments across its core brand portfolio: adidas,
Reebok and TaylorMade. Further, the Group unleashed open source, a
strong commitment to further strengthen the company's ties with its
consumers. By increasing consumer desire in how the Group creates,
designs and presents products, the adidas Group will engage with
consumers, athletes, retailers and partners more than ever before,
make them become part of its brands and, as a result, increasingly
build brand advocacy.
"We are closest to every consumer
with our unique brand portfolio," said Eric Liedtke, Executive
Board Member responsible for Global Brands. "In the future, we will
not only talk to and talk with our consumers. We will be the first
sports company that invites athletes, consumers and partners to be
part of its brands. We will open up so that they can co-create the
future together with us." Already today, the adidas Group is
working together with some of the world's most creative and
innovative influencers and organisations such as Stella McCartney,
Kanye West, BASF or Google.
Accelerated
growth
With the three strategic choices
driving a surge in brand desirability, the adidas Group expects to
generate high-single-digit currency-neutral sales growth per year
on average over the next five years. By outperforming the sporting
goods industry, the Group's brands will increase market share over
the period and thus expand its ability to generate attractive
margin expansion and operating leverage. As a result, the bottom
line is expected to grow at a faster rate than the top line, with
net income forecasted to increase by around 15% on average per year
until 2020 compared to the expected 2015 results.
In addition, due to the continued
focus on cash creation, the Group's cash flow is anticipated to
grow at a faster rate compared to the operating profit in each of
the next five years. As a result of the company's already very
healthy financial position, the expected strong cash generation as
well as Management's commitment to sustainable value creation, the
Group has increased the corridor for future dividend payments.
Going forward, the company intends to pay out between 30% and 50%
of its net income attributable to shareholders (previously:
20%-40%). Furthermore, the adidas Group will continue its
multi-year shareholder return programme of up to € 1.5 billion,
launched in the fourth quarter of 2014.
"Our new strategy is built on
speed, focus and openness," said Herbert Hainer. "As a result, we
will accelerate our growth story and deliver superior returns to
our shareholders. I am very much looking forward to 'creating the
new' together with the adidas Group's more than 53,000 employees
across the globe."
About the adidas
Group
The adidas Group is a global
leader in the sporting goods industry, offering a broad portfolio
of footwear, apparel and hardware for sport and lifestyle around
the core brands adidas, Reebok, TaylorMade and Reebok-CCM Hockey.
Headquartered in Herzogenaurach/Germany, the Group employs more
than 53,000 people across the globe and generated sales of € 14.5
billion in 2014.
***
Contacts:
Media Relations |
Investor Relations |
Jan Runau |
Sebastian Steffen |
Chief Corporate Communication Officer |
Vice President Investor Relations |
Tel.: +49 (0) 9132 84-3830 |
Tel.: +49 (0) 9132 84-4401 |
|
|
Katja Schreiber |
Christian Stoehr |
Senior Director Corporate Communication |
Director Investor Relations |
Tel.: +49 (0) 9132 84-3810 |
Tel.: +49 (0) 9132 84-4989 |
|
|
|
Yifeng Wang |
|
Manager Investor Relations |
|
Tel: +49 (0) 9132 84-3057 |
Please visit our corporate website: www.adidas-Group.com
adidas Group Strategy 2020
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Source: adidas AG via Globenewswire
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