Adidas Ag · XETR:ADS
Adidas — Adidas Ag Ord — FY 2024 Earnings Presentation
84 slides from Adidas's earnings presentation, Mar 5, 2025
Slide 1: Full Year 2024 Results
Slide 2: Full Year 2024 Results
Slide 3: Full Year 2024 Financial Update
a\\ WE AREA SPORTS BRAND AND 2024 WAS THE YEAR OF SPORTS
Slide 4: We are a sports brand and 2024 was the year of sports
2024 WAS THE YEAR OF SPORTS EURO AND COPA ee =|) 6 THE GHAMP ya cs ne
Slide 5: 2024 was the year of sports: Euro and Copa
2024 WAS THE YEAR OF SPORTS EURO AND COPA
Slide 6: 2024 was the year of sports: Olympics and Paralympics
2024 WAS THE YEAR OF SPORTS OLYMPICS AND PARALYMPICS = ¥
Slide 7: Sports celebrated across the world
WAS THE YEAR OF SPORTS ELEBRATED ACROSS THE WORLD . r raf 20 SPORTS BEING
Slide 8: Special Olympics
SPECIAL OLYMPICS a ener hy ge) “4 g
Slide 9: And the year of the hottest shoes
whs “ve AND THE YEAR OF THE HOTTEST SHOES
Slide 10: We have the hottest shoes on the streets today
WE HAVE THE HOTTEST SHOES ON THE STREETS TODAY SCALED UP
Slide 11: Terrace, Samba, Gazelle, Handball Spezial
WE HAVE THE HOTTEST SHOES ON THE STREETS TODAY SS = = TERRACE SAM BM, GAZELLE, HANDBALL SPEBIAL
Slide 12: Hottest shoes: scaled up today, growth tomorrow
WE HAVE THE HOTTEST SHOES ON THE STREETS TODAY SCALED UP TOMORROW GROWTH
Slide 13: Hottest shoes on the streets tomorrow
WE HAVE THE HOTTEST SHOES ON THE STREETS TOMORROW
Slide 14: Hottest shoes: scaled up today, growth tomorrow
WE HAVE THE HOTTEST SHOES ON THE STREETS TODAY SCALED UP TOMORROW GROWTH
Slide 15: Hottest shoes tomorrow: lifestyle
WE HAVE THE HOTTEST SHOES ON THE STREETS TOMORROW LIFESTYLE is
Slide 16: Hottest shoes tomorrow: lifestyle
WE HAVE THE HOTTEST SHOES ON THE STREETS TOMORROW ‘LIFESTYLE 7 so “ =_—| é: ~ . X 1% ica
Slide 17: Hottest shoes: scaled up today, growth tomorrow
WE HAVE THE HOTTEST SHOES ON THE STREETS TODAY SCALED UP TOMORROW GROWTH
Slide 18: Superstar
WE HAVE THE HOTTEST SHOES ON THE STREETS iY py PPAR: SUPERSTAR SUPERSTAR Bs aie oS
Slide 19: Magic happens when we unite our power
nis A MAGIC HAPPENS WHEN WE UNITE OUR POWER
Slide 20: Sport meets culture
MAGIC HAPPENS WHEN WE UNITE OUR POWER SPORT MEETS CULTURE
Slide 21: Speed meets style: Petronas
MAGIC HAPPENS WHEN WE UNITE OUR POWER PeThONaS SPEED MEETS STYLE | THE RACE BEGINS
Slide 22: Lamine Yamal: the family grew in sports and culture
ay, Luretava A a LAMINE YAMAL THE FAMILY GREW IN SPORTS AND CULTURE
Slide 23: Roadmap to success
ROADMAP TO SUCCESS 2023 2024 BETTER COMPANY BREAK EVEN COMPANY AND TRANSITION
Slide 24: Successful 2024 finished better-than-expected
SUCCESSFUL 2024 FINISHED BETTER-THAN-EXPECTED € IN MILLIONS FY 2023 FY 2024 Y-0-Y NET SALES ar 23,683 inn GROSS PROFIT oe 12,026 +18% % OF NET SALES 50.8% +3.3PP OPERATING PROFIT 2 1,337 +398% % OF NET SALES 5.6% +4.4PP
Slide 25: Q4 2024 revenue growth by market
Q4 2024 REVENUE GROWTH BY MARKET EUROPE NORTH JAPAN AMERICA +25% GREATER SOUTH KOREA +15% CHINA +9% +16% LATIN EMERGING AMERICA MARKETS +31% +21% TOTAL COMPANY GROWTH 04 2024 AT +19% (ADIDAS BRAND +18%)
Slide 26: 2024 revenue growth by market
2024 REVENUE GROWTH BY MARKET JAPAN/ ADIDAS ADIDAS SOUTH KOREA 1 BRAND NORTH ADIDAS EUROPE. BRAND 0 AMERICA 1 BRAND +19% +10% 1 +10% 0 come 10 120% GREATER pina -2% 1+1% CHINA! BRAND VS.2023 0 +10 % 1+10% LATIN EMERGING AMERICA (BRAND. MARKETS | BRAND. +28% 1 +28% +19% 1 +20% vs. 2023 Vs. 2023 TOTAL
Slide 27: FY 2024 revenue growth by channel
FY 2024 REVENUE GROWTH BY CHANNEL 40% 22% OWN RETAIL SY oS @- PETRONAS 18% - OWNE-COM 60% WHOLESALE +14% +15% +6% +18% WHOLESALE OWN RETAIL E-COM &XCL. (INCL. FRANCHISE) YEEZY FY 2024 CHANNEL GROWTH FY 2024 CHANNEL SPLIT
Slide 28: FY 2024 revenue growth by product division
FY 2024 REVENUE GROWTH BY PRODUCT DIVISION 6% ACCESSORIES 59% 35% FOOTWEAR = APPAREL +17% +6% +2% FOOTWEAR APPAREL ACCESSORIES FY 2024 PRODUCT DIVISION GROWTH FY 2024 PRODUCT DIVISION SPLIT REVENUE GROWTH CURRENCY NEUTRAL
Slide 29: FY 2024 revenue growth by category
FY 2024 REVENUE GROWTH BY CATEGORY PERFORMANCE SPORTSWEAR ORIGINALS, BASKETBALL, PARTNERSHIPS & SKATEBOARDING +9% +6% +25%
Slide 30: Slide 30
Slide 31: P&L items
rar) P&L ITEMS LATEST EIN MILLIONS FY 2024 y. FY 2024 GUIDANCE ty = ADIDAS BRAND +13% C.N. NET SALES jatar | ES sone, =INCL. YEEZY REVENUES OF ~€ 650M IN FY - +10% C.N. GROSS PROFIT 10,184 12,026 % OF NET SALES 41.5% 50.8% +3.3PP PERATING PROFIT 2 1 y . ~ 0 PER! TING 0 +398% INCL. YEEZY PROFIT OF ~€
Slide 32: Guidance evolution
ara) GUIDANCE EVOLUTION INITIAL UPDATED UPDATED west FY 2024 GUIDANCE GUIDANCE GUIDANCE GUIDANCE ACTUALS JANUARY 31 APRIL 16 JULY 16 OCTOBER 15 DECEMBER 31 mip-sineLe-picit || MID-TOHIGH. |! High-sINGLE-DIGIT NET SALES INCREASE see INCREASE ~+10% OPERATING PROFIT ~€ 500M ~€700M ~€1.0BN ~€1.2BN
Slide 33: Operating profit
ara) OPERATING PROFIT INITIAL GUIDANCE FY 2024 ACTUALS JANUARY 31 DECEMBER 31 ~€ 600M OPERATING YEEZY ADIDAS OPERATING PROFIT BRAND PROFIT
Slide 34: Yeezy
aa) YEEZY
Slide 35: P&L items
(TPT) P& ITEMS € IN MILLIONS FY FY 2023 || 2024 | ¥O¥ +11% NET SALES 21,427 23,683 *ADIDAS BRAND +18% C.N, 3 “12h CN. «NO IMPACT FROM ARGENTINE PESO GROSS PROFIT 10,184 12,026 +18% 2,147 2,970 % OF NET SALES 41.5% 50.8% +3.3PP 44.6% 19.8% OPERATING PROFIT 268 1,337 +398% "NO MATERIAL YEEZY PROFIT %
Slide 36: P&L items
rar) P&L ITEMS € IN MILLIONS = ADIDAS BRAND +13% C.N. GROSS PROFIT 10,184 12,026 % OF NET SALES 47.5% 50.8% +3.3PP
Slide 37: Gross margin drivers
GROSS MARGIN DRIVERS +3.3PP ~ 50.5% EXCL. YEEZY PRODUCT COSTS DISCOUNTING INVENTORY PROVISION SES) Sl) g NEGATIVE CURRENCY EFFECTS FADED IN Q4 AS EXPECTED GROSS NO YEEZY EFFECT IN Q4 MARGIN LLUSTRATIVE. ,---{ +5.2P |--., 1 v 49.8% é 44.6% GROSS GROSS 04 2023 MARGIN () 4
Slide 38: Gross margin drivers
GROSS MARGIN DRIVERS +3.3PP ~ 50.5% EXCL. YEEZY PRODUCT COSTS DISCOUNTING INVENTORY PROVISION YEEZY Fy 2024s Gicfatoioyelor. | GROSS MARGIN LLUSTRATIVE.
Slide 39: P&L items
ra) P&L ITEMS € IN MILLIONS NET SALES GROSS PROFIT % OF NET SALES 9 uM: 10,184 12,026 47.5% 50.8% +3.3PP OTHER OPERATING INCOME MARKETING & POS EXPENSES % OF NET SALES INCL. ACCRUALS RELEASE OF ~ € 100M IN Q3 2,528 2,844 +12% 11.8% 12.0% +0.2PP INCL. DONATIONS OF ~ € 100M AND ONE-OFF COSTS OF ~ € 20
Slide 40: Operating profit decomposed
OPERATING PROFIT DECOMPOSED ACCRUALS DONATIONS ONE-OFF YEEZY oe RATINE RELEASE costs PROFIT ONDERETING PROFIT PROFIT FY 2024 FY 2024 LLUSTRATIVE.
Slide 41: P&L items
ra) P&L ITEMS € IN MILLIONS OPERATING PROFIT 1,337 +398% % OF NET SALES 1.3% 5.6% +4.4PP FINANCIAL INCOME = INCREASE IN Q4 DUE TO HIGHER FINANCING COSTS FINANCIAL EXPENSES za | ix IN SELECT COUNTRIES AND NEGATIVE FX EFFECTS INCOME BEFORE TAXES 1,124 +1,612% % OF NET SALES 0.3% 4.7% +4,4PP INCOME TAX
Slide 42: Balance sheet development
airy) BALANCE SHEET DEVELOPMENT INVENTORIES | 425 | 4,989 +10% | +11% C.N.
Slide 43: Inventory development
INVENTORY DEVELOPMENT € IN BILLIONS Q4 2023 AT QUARTEREND. +10% | +11% C.N. Q1 2024 Q2 2024 Q3 2024 Q4 2024 HEALTHY INVENTORY POSITION TO SUPPORT CONTINUED DOUBLE-DIGIT TOP- LINE GROWTH FOR THE ADIDAS BRAND TMEV
Slide 44: Balance sheet development
airy) BALANCE SHEET DEVELOPMENT € IN MILLIONS INVENTORIES | 4525 | £10% | +11% CN. ACCOUNTS RECEIVABLE | 1906 | | ats | 127% | +26% CN. ACCOUNTS PAYABLE | 2276 | | 3.006 | +36% | +36% C.N. OPERATING WORKING CAPITAL | tse | | 4306 | £4% | +4% C.N.
Slide 45: Average operating working capital development
AVERAGE OPERATING WORKING CAPITAL DEVELOPMENT AS A % OF NET SALES pescceeceeeao ed -5.9PP secceeeceenneny Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 AVERAGE OPERATING KING CAPITAL = AVERAGE OF OPERATING WORKING CAPITAL FOR THE LAST 4 QUARTERS DIVIDED BY NET SALES FOR THE LAST 4 QUARTERS.
Slide 46: Balance sheet development
airy) BALANCE SHEET DEVELOPMENT € IN MILLIONS INVENTORIES | 4525 | +10% | +11% C.N. ACCOUNTS RECEIVABLE | 1906 | | ats | +27% | +26% C.N. ACCOUNTS PAYABLE | 3.006 | +36% | +36% C.N. OPERATING WORKING CAPITAL | tse | | 4306 | +4% | +4% C.N. CAPITAL EXPENDITURE | soe | | sao |
Slide 47: Capex investments
CAPEX INVESTMENTS OTHER LOGISTICS €540M |) sume INITIATIVES
Slide 48: Balance sheet development
airy) BALANCE SHEET DEVELOPMENT € IN MILLIONS INVENTORIES | 4525 | +10% | +11% C.N. ACCOUNTS RECEIVABLE | 1906 | | ats | +27% | +26% C.N. ACCOUNTS PAYABLE | 3.006 | +36% | +36% C.N. OPERATING WORKING CAPITAL CAPITAL EXPENDITURE +7% CASH AND CASH EQUIVALENTS +72h
Slide 49: Cash and net borrowings development
CASH AND NET BORROWINGS DEVELOPMENT CASH AND CASH EQUIVALENTS ADJUSTED NET BORROWINGS € IN BILLIONS € IN BILLIONS FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024
Slide 50: Net leverage ratio development
NET LEVERAGE RATIO DEVELOPMENT STRONG DELEVERAGING TO AN ADJUSTED NET BORROWINGS/EBITDA RATIO OF 1.5X 3.2X 3.3X <2.0x Financial Policy FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 ILLUSTRATIVE.
Slide 51: Dividend proposal
rs P2) DIVIDEND PROPOSAL = DIVIDEND PER SHARE | com | | ez | SHARES OUTSTANDING 70 muon TOTAL PAYOUT | esas | ai sy.1t REFLECTS = Significantly better-than-expected performance in 2024 = Improved financial profile = Confident outlook = Payout ratio of 43%, within target range of 30-50% of net income
Slide 52: Sport uniting communities: adidas Foundation
SPORT UNITING COMMUNITIES THROUGH (8): ION “WA ADIDAS FOUNDAT ADIDAS FOUNDATION Independent non-profit organization focusing on: > Fighting Hate and Discrimination » Sport for Sustainable Development » Access to Sport for vulnerable groups UNITED BY SPORT PROGRAM Using Sport to fight all forms of ha
Slide 53: 2024 ESG achievements
2024 ESG ACHIEVEMENTS -5.3% CARBON INTENSITY REDUCTION VS. 2022 99% RECYCLED POLYESTER SOURCED IN 2024 SCORED A FOR CLIMATE CARBON DISCLOSURE PROJECT (CDP) 100% SOLAR ELECTRICITY IN OWN OPERATIONS SECURED IN EUROPE, USA & CANADA FOR 2025+ (y) 100% STRATEGIC T1 EXCEED MINIMUM WAGES @ ZERO WORKER FATA
Slide 54: Winning with our global local team
Slide 55: Halftime
HALFTIME : 10% NS'GROW /~ 50-52% Ail, . 2023 2024 2025 2026 Le > Ws { ) & ~3 4 hy , " i ois BETTER HEALTHY Cay COMPANY COMPANY (att 4 BREAK EVEN ALAN % EBIT COMPANY GOOD @ Py i : AND TRANSITION COMPANY Ae ‘ff
Slide 56: How we got here
2024 HOW WE GOT HERE .-AND BREAKING A LOT OF OWN RULES
Slide 57: Roadmap to success
ROADMAP TO SUCCESS 2026 HEALTHY 7 COMPANY n> =
Slide 58: adidas AG
ADIDAS AG 58
Slide 59: A global brand with a local mindset
A GLOBAL BRAND WITH A LOCAL MINDSET CONSUMER ITALL STARTS WITH THE CONSUMER NEEDS MARKETS RESPONSIBLE FOR COMMERCIAL SUCCESS CREATION CENTERS TAILOR TO LOCAL DEMAND GLOBAL GLOBAL PROVIDES FRAME FOR — BRAND IDENTITY, DESIGN, INNOVATION & CONCEPTS GLOBAL SUPPORTS MARKETS OPERATING MODEL PRINCIPLES DEC
Slide 60: Reduce complexity: operating model, workstreams
Slide 61: We are a global brand with a local mindset
Slide 62: Local activation, global brand with a local mindset
LOCAL A TS GLOBAL BRAND WITHA L MINDSET IT'S ONLY|IHE FS & ey
Slide 63: Local activations: North America
LOCAL ACTIV GLOBAL BRAN AG. ace NORTH AMERICA Adidas signs first NIL deal with girls’ high school basketball player
Slide 64: When did adidas clothes get this good?
WHEN DID ADIDAS CLOTHES GET THIS GOOD?
Slide 65: A IL
A IL ‘Ba ay
Slide 66: Local mindset and products
& PRODUCTS H A LOCAL MINDSET
Slide 67: Latin America
LATIN AMERICA
Slide 68: Emerging markets
im Ad py rites ae | e EMERGING | MARKETS |
Slide 69: Good company 2025: what's next?
2025 GOOD COMPANY WHAT'S NEXT? HIGHXTAR. idas, Patrick Mahomes Sign Inaugural Six Té Why the adidas Superstar will be the next must-have Tech Student-Athletes to Team Mahomes of the FW24/25 season? At Paris Fashion Week, the Adidas Superstar Stole the Show(s) In order to be a “global brand with a lo
Slide 70: We have the hottest apparel on the streets
WE HAVE THE HOTTEST APPAREL ON THE STREETS a iy ay.
Slide 71: Taking momentum from lifestyle to performance
nae KX TAKING MOMENTUM FROM LIFESTYLE TO PERFORMANCE
Slide 72: Football
FOOTBALL
Slide 73: "SG
"SG
Slide 74: Basketball
Slide 75: Training
Slide 76: We are (re)investing in all sports
AAS WE ARE (RE)INVESTING IN ALL SPORTS
Slide 77: Showing up strong in moments that matter
2025 SHOWING UP STRONG IN MOMENTS THAT MATTER AA Believe That. WOMEN’S L, WORLD CUP yOME 1H AMERICA TO GEAR UP FOR 2026
Slide 78: nhs
nhs —S|V
Slide 79: adidas Originals: Superstar
2025 ADIDAS ORIGINALS SUPERSTAR gh INALS SUPERSTAR => SUPERSTAR 7 ’ y a ee AA N e £< n= r, \ 2* pa ( q
Slide 80: 2025 You Got This
Slide 81: FY 2025 outlook
Slide 82: Roadmap to success
Slide 83: The time is now
Slide 84: Q&A