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by Stephan Bauer, Euro am Sonntag
Groar, wiry, athletic – Kasper Rorsted came across as sporty this time too. The adidas boss unwound the presentation of his first five-year plan for the Franconian sporting goods manufacturer at a breathtaking pace: “Our mission is to be the best sports brand in the world.”
With an e-commerce offensive, investments in technology and a boost in digitization, the Dne wants to bring the three-stripe brand forward. Rorsted also had poor numbers in his luggage. In 2020, sales shrank by 16 percent to just under 20 billion euros, and the operating result by over 70 percent to 751 million euros. “We have never had a year like this,” said Rorsted.
The Swiss franc also recorded a comparatively weak recovery in sales in the fourth quarter. Global business grew currency-adjusted by one percent to 5.5 billion euros. The Herzogenaurach arch-rival PUMA, for example, had a quite strong sales upturn of a good nine percent in the Christmas quarter.
Rorsted is under pressure not just to make it a success again in 2021. The ambitious manager has big plans: Sales should increase by 15 to 19 percent in 2021, and the operating margin should accelerate from the weak 3.8 percent of the Corona year to a sporty ten percent. The chances of a trend reversal are not bad because the market for sportswear and shoes is growing globally. During the pandemic, many previously rather unsportsmanlike people discovered the fun of exercise. “The market is growing in the mid-single-digit percentage range every year. We want to grow faster,” promises Rorsted.
Double the payout
Its medium-term goals are also ambitious: by 2025, the DAX group is expected to increase sales by between eight and ten percent per year on average, with net profit climbing 16 to 18 percent. In the end, the operating margin is estimated at between twelve and 14 percent. The total distribution should be between eight and nine billion euros – for comparison: from 2015 to 2019, the DAX group distributed around four billion euros to the shareholders.
The most important lever for the comeback is online. In the pandemic year, which resulted in the closure of many of its own branches and numerous other sales outlets, adidas Internet sales rose by over 50 percent to a good four billion euros. By 2025, Rorsted wants to more than double the volume here and create between eight and nine billion euros on the web. One vehicle for this is the adidas membership program, which currently has 150 million users. The boss wants to increase the number to 500 million by 2025. 80 percent of the planned increase in sales in the group should ultimately come from direct sales to customers via the web and own branches.
Sustainability is a big issue for the Franks. Eco-motivated or vegan customers can purchase a popular shoe model, the Stan Smith sneaker, made of mushroom-based imitation leather – 100 percent biodegradable.
Pulse: Brsians forgive that weak 2020 and look back front. The plans of the Franks are coming good at. Buy signal over 300 euros.
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Image Sources: Hannah Hlavacek / adidas Group, TonyV3112 / Shutterstock.com