Adidas Ag · XETR:ADS
Adidas — Non-Deal Roadshow (October 2012)
51 slides from Adidas's roadshow presentation, Oct 3, 2012
Slide 1: Together We Win – Roadshow Presentation, London
Roadshow Presentation London, October 03, 2012 TOGETHER John Paul O‘Meara VP Investor Relations, adidas AG WE WIN
Slide 2: Route 2015 Financial Milestones
ROUTE 2015 FINANCIAL MILESTONES
Slide 3: Creating the Most Desirable Brands
CREATING THE MOST DESIRABLE BRANDS
Slide 4: Outstanding Start to Route 2015
OUTSTANDING START TO ROUTE 2015 € 14.3bn € 776m € 12.0bn +€ 2.4bn € 567m +€ 209m 2010 H1 2012 rolling 2010 H1 2012 rolling *currency-neutral
Slide 5: Quality Top-Line Growth Drives Margin Improvements Despite Severe Challenges
QUALITY TOP-LINE GROWTH DRIVES MARGIN IMPROVEMENTS DESPITE SEVERE CHALLENGES 1,0pp 1,5pp 0,0pp 1,0pp Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 -1,0pp 0,5pp -2,0pp 0,0pp Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 -3,0pp -0,5pp -4,0pp -1,0pp -5,0pp FOB impact -1,5pp Opex as % of sales chang
Slide 6: Global Brands Revised Sales Targets
GLOBAL BRANDS REVISED SALES TARGETS 2010 OLD NEW
Slide 7: adidas Sales Target Increased 5%
ADIDAS SALES TARGET INCREASED 5%
Slide 8: Other Businesses to Achieve 2015 Goal Already This Year
OTHER BUSINESSES TO ACHIEVE 2015 GOAL ALREADY THIS YEAR
Slide 9: Reebok to Focus on Building Sustainable Fitness Categories
REEBOK TO FOCUS ON BUILDING SUSTAINABLE FITNESS CATEGORIES
Slide 10: Global Sales Revised Revenue Targets
GLOBAL SALES REVISED REVENUE TARGETS 2010 OLD
Slide 11: Strong Position to Achieve 11% Operating Margin Target
STRONG POSITION TO ACHIEVE 11% OPERATING MARGIN TARGET Quality of distribution Emerging Market Manufacturing Growth excellence Retail Performance proficiency driven Trade Terms Organisational Infrastructure set-up modernisation Range reduction
Slide 12: Prudent Management in Challenging Economic Environment
PRUDENT MANAGEMENT IN CHALLENING ECONOMIC ENVIRONMENT Net debt Inventory growth rate 400 (currency-neutral) 40% 0 30% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2010 2010 2010 2011 2011 2011 2011 2012 2012 20% -400 10% -800 0% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 -1.200 -10% 2010 2010 2010 2011 2011 2011 2011 2012 2012
Slide 13: 2013 Will See Significant Innovation Pipeline
2013 WILL SEE SIGNIFICANT INNOVATION PIPELINE
Slide 14: 2013 Deepening Emotional Connection to the Consumer
2013 DEEPENING EMOTIONAL CONNECTION TO THE CONSUMER
Slide 15: Enduring Success
ENDURING SUCCESS
Slide 16: Appendix: 2015 Aspirations
adidas APPENDIX: 2015 ASPIRATIONS
Slide 17: Global Brands Game Changing Growth Projects
GLOBAL BRANDS GAME CHANGING GROWTH PROJECTS REEBOK NEO ADIDAS FITNESS EMPIRE FAST FASHION RUNNING BASKETBALL CUSTOMIZATION INTERACTIVITY
Slide 18: Brand Architecture: Portfolio Strategy
BRAND ARCHITECTURE: PORTFOLIO STRATEGY 8% 14% 22% 14% 26% 10% 6% PURE ATHLETIC ATHLETIC BRAND SPORT STYLE STYLE PERFORMER STYLE CLASSIC DRIVEN INSPIRED ADOPTER SETTER SPORTS COMPETITIVE SPORTS ACTIVE SPORTS CASUAL SPORTS FASHION 12% 78% 10%
Slide 19: Brand Architecture: Business Reality
BRAND ARCHITECTURE: BUSINESS REALITY 8% 14% 22% 14% 26% 10% 6% PURE ATHLETIC ATHLETIC BRAND SPORT STYLE STYLE PERFORMER STYLE CLASSIC DRIVEN INSPIRED ADOPTER SETTER SPORTS COMPETITIVE SPORTS ACTIVE SPORTS CASUAL SPORTS FASHION 12% 78% 10%
Slide 20: adidas Sport Performance – Making the Athlete Better
ADIDAS SPORT PERFORMANCE – MAKING THE ATHLETE BETTER
Slide 21: adidas Sport Style – Multi-Label Strategy
ADIDAS SPORT STYLE – MULTI-LABEL STRATEGY
Slide 22: adidas Originals – Iconic and Authentic Street Style
ADIDAS ORIGINALS – ICONIC AND AUTHENTIC STREET STYLE
Slide 23: NEO Label Attributes and USP
NEO LABEL ATTRIBUTES AND USP New NEO provides constant newness - always visible in collection and stores Active Attracting a consumer who is fully engaged in life, be it through social networking, family, friends, outdoor, sports ... Accessible Easy to find, to understand and to relate to: accessibl
Slide 24: NEO Targets a Global Consumer with a Homogenous Fashion Style
NEO TARGETS A GLOBAL CONSUMER WITH A HOMOGENOUS FASHION STYLE
Slide 25: Slide 25
Slide 26: The Fitness Brand
The FITNESS Brand imi Clearly defined Category Focus — FP Product and Technology Excellence —f2 Deep Consumer Connection — fr} Distribution and Focus on Key Markets Reebok
Slide 27: From an Activity to a Lifestyle
From an activity to a lifestyle... Activity Community Events Social Media @blondeponytail Do your fore arms feel swollen after pull-ups?! Feel like | should ice mine! @keithbritton NEW Personal Record! 1 Mile Run For Time > 6'34* Feels SOOO good to write it down in my journal!! Reebok
Slide 28: New Organization: Focus on Fitness Categories
New organization: Focus on Fitness categories Training Running Toning FUNCTIONS Brand Strategy Brand Comms Reebok
Slide 29: Meet Consumers Where They Live Within Their Fitness Life
Meet consumers where they live within their fitness life Instructor ©__ Se Network oT Grassroots “7, os Reebok / N Retail y ~~ Retail Store Management Broad ci -_— Digital & Reach Tracking Reebok
Slide 30: TaylorMade
it @saylorMade 2 rf j y sence
Slide 31: New Design
INSPIRE SEEK LEAD ACT WITH PEOPLE | | GREATNESS) | CHANGE SPEED
Slide 32: Disrupt the Market Place
» DISRUPT THE MARKET PLACE » DRIVE PERFORMANCE THROUGH INNOVATION oo 7) Y » VALIDATE ON TOUR VER IN GOLF wgaylorMade _ DELIVER HOT PRODUCTS AZ _ REACT QUICKLY TO MARKET SHIFTS » STAY TRUE TO OUR BRAND VALUES
Slide 33: The Big Opportunity
THE BIG OPPORTUNITY
Slide 34: €1.5 Billion
€1.5 BILLION
Slide 35: Sustainable Growth in Key Attack Markets
SUSTAINABLE GROWTH IN KEY ATTACK MARKETS North America • Biggest growth potential • Focus on High School Kids and Team Sports Greater China • Market leadership by 2015 • Increase store base Russia/CIS • Increase market share of currently 60% to 70% • Become leading sports brands in Outdoor
Slide 36: fee On
fee On Ne il S
Slide 37: on Dthe field andi in. the ballwoy
on Dthe field andi in. the ballwoy —_—
Slide 38: Million
16 million
Slide 39: Sales Highlights
SALES HIGHLIGHTS
Slide 40: Sales Highlights
adidas nam SALES HIGHLIGHTS doubled fw share
Slide 41: Sales Highlights
adidas nam SALES HIGHLIGHTS 21%
Slide 42: % of Net Sales
% of Net Sales HSK Focus 40% 47% 51% 62% Channels Other 60% 53% 49% 38% Channels 2009 2010 2011 2012
Slide 43: YTD 12
adidas YTD 12 REST OF MARKET SOURCE – NPD
Slide 44: Clear #2 Market Share, Delivery of Top and Bottom Line
2015 2014 ✓ 2012 2013 clear #2 market share #1 with high school kid 2011 innovation and brand 2010 marketing push delivery of top and team business attack bottom line inspirational focus concepts
Slide 45: Chinese Consumer Becoming More Sophisticated
CHINESE CONSUMER BECOMING MORE SOPHISTICATED
Slide 46: Category Attack in Higher Tier Cities
CATEGORY ATTACK IN HIGHER TIER CITIES
Slide 47: Time to Unleash Originals
TIME TO UNLEASH ORIGINALS
Slide 48: Increasing Store Footprint to Capture Growth
INCREASING STORE FOOTPRINT TO CAPTURE GROWTH 1. City-by-city footprint plan to match local retail environment 2. Segmentation to match purchase patterns of high vs. low spenders 3. Accessible pricing options to complement range 4. POS increase of 2,500 by 2015
Slide 49: Russia/CIS Driven by adidas and Reebok Own Retail
RUSSIA/CIS DRIVEN BY ADIDAS AND REEBOK OWN RETAIL ~800 own retail stores in 2011 ~1,200 own retail stores by 2015 >90% of sales through own retail in 2011 YTD December 2011 comp store sales +24%
Slide 50: Opportunities Outweigh Challenges in Russia/CIS
OPPORTUNITIES OUTWEIGH CHALLENGES IN RUSSIA/CIS
Slide 51: adidas in Superior Competitive Position
adidas In Superior Competitive Position Significant coverage and Distribution market penetration Broad range covering Product Range multiple consumer targets Unmatched partnership portfolio Brand Marketing Strong POS activation