Adidas 1996 Annual Report Download - page 35

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35
In Footwear net sales increased
18% to DM 582 million in 1996
compared to 495 million in 1995.
The increase in footwear was pri-
marily driven by the running and
training categories. The running
category performed particularly well
(+74% in local currency), reflecting
the strength of the running product
line as well as the North American
casual consumer’s desire for an
alternative to the training silhouette.
The basketball category surpassed
soccer as the number one sports
category in terms of sales volume
achieving a growth rate in local cur-
rency of 9% in 1996. In order to fur-
ther strengthen our presence in the
North American basketball market,
we have added management
re-
sources and intensified promotion
al
efforts, featuring promising NBA
athletes such
as Kobe Bryant (Los
Angeles Lakers)
and Antoine Walker
(Boston Celtics).
Footwear featuring Feet You Wear
technology was launched in limited
quantities in North America in
August 1996.
Net sales of Apparel increased
by 62% to DM 437 million from
DM 269 million in 1995, reflecting
the continued popularity of the brand,
in addition to the North American
consumer’s taste for branded
apparel.
Asia/Pacific
Overall favorable market conditions
in the Asia/Pacific region encouraged
our development in 1996 in this
region. Net sales grew by 51%, from
DM 307 million in 1995 to DM 464
million in 1996 as a result of positive
developments at newly established
joint ventures and wholly-owned
subsidiaries. Our market position
was revitalized in developing mar-
kets like Indonesia, Thailand and the
Philippines. Larger subsidiaries such
as Australia and Hong Kong contin-
ued to show good performance.
Our expansion strategy in Asia/Pacific
is best illustrated by the fact that the
number of majority-owned subsid-
iaries increased from 5 in 1994 to
12 in 1996.
In 1996, we assumed 100% control
of our subsidiaries in Australia, our
largest Asia/Pacific subsidiary, as
well as in New Zealand by acquiring
the outstanding shareholdings of
51% each from Pacific Dunlop.
Effective October 1, 1996, we
became a 51% shareholder in Jewoo
Trading Co. Ltd., the distributor of
adidas products in South Korea.
Additional
ly, the wholly-owned sales
subsid
iary in Taiwan and the joint
venture in
India were operational at
the end of
1996.
By sports category, sales were
particularly strong for training, soccer
and running, with Footwear grow-
ing at 35% and Apparel at 67%.
Net sales development in the major
licensee country, Japan, continued
to be strong.
Apparel (%)
Footwear (%)
mNet Sales –
North America1)
(DM million)
1) Hardware business is
primarily conducted by licensees
The major focus in Asia/Pacific will
be on further strengthening the
brand image and on integrating new
operations. This will allow us to
exploit cost synergies and to intro-
duce adidas standards in terms of
promotion spending, marketing
control and purchasing, allowing us
to fully participate in the growth
opportunities in this region.
Net Sales – Rest of World
328
398
1995
572
19961994
74
77
81
26
23
19
Latin America
(%)
Asia/Pacific
(%)
mNet Sales –
Rest of World
(DM million)
Net Sales – North America
768 767
1995
1,026
19961994
71 65
57
29 35
43