Reebok 2009 Annual Report Download - page 26

22 TO OUR SHAREHOLDERS Interview with the CEO
HERBERT HAINER
We live for big events, and this summer’s FIFA World
Cup™ in South Africa will be something very special for
a number of reasons. Twelve of our teams including the
host nation will compete in the finals, which combined with
our status as official sponsor, supplier and licensee gives
us an unparalleled presence at the event. It will also have
an unprecedented scale of media coverage as the world’s
largest television event, broadcast to over 190 countries and
an estimated cumulative audience of 26.3 billion. It’s also
the first time the competition will be hosted on the African
continent, where football is always a celebration – vibrant,
colourful and passionate. And we will take this flair global in
2010. A great example is the adidas JABULANI match ball, the
eleventh adidas World Cup ball. Eleven different colours are
used, representing the 11 players in every team, the 11 official
languages of South Africa and the 11 South African tribes.
With our experience in leveraging such events, and having
the most comprehensive representation in South Africa, I am
convinced this FIFA World Cup™ will be even more exceptional
for us than the last. Taking this and all our other football
initiatives together, I am confident that we will generate over
€1.3 billion in sales in the football category in 2010.
HERBERT HAINER
We emerge from the challenges of 2009 with renewed
optimism. Our financial position is healthy; our brand
concepts and campaigns are strong; and the retail industry
is finally beginning to show early signs of life again, as global
trade strengthens and consumer confidence slowly begins to
recover. There will undoubtedly be some more tough months
ahead but, in general, I feel confident enough to say that
2010 will be a much better year. We forecast full year sales
to increase at a low- to mid-single-digit rate on a currency-
neutral basis, driven by growth in both Wholesale and Retail.
Sales will also increase at both the adidas and Reebok
brands. We expect gross margin to improve to between 46%
and 47% with lower sourcing costs and less margin pressure
from clearance of excess inventories. To capitalise on major
sports events as well as new product and campaign launches,
we will invest in marketing and controlled space, securing
share of voice and premium distribution. At the same time, we
will remain disciplined in managing our operating cost base,
and we expect operating margin to increase to around 6.5%
from 4.9% in 2009. Summing up, I expect an improvement
in diluted earnings per share to a level between € 1.90 and
€ 2.15 from € 1.22 in 2009.
QUESTION
The FIFA World Cup™ is just around
the corner. Do you think it will be as
successful for you as in 2006 and are
you still confident you will reach your
goals?
QUESTION
What are your financial expectations
for 2010?