Adidas 1996 Annual Report Download - page 5

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The philosophy behind Feet You Wear is
simple and powerful: based on the funda-
mental observation that the foot is at its
best in its natural state, adidas designed a
shoe which offers athletes the biomechan-
ical properties of the foot in a high-perfor-
mance shoe. The current range, which
includes shoes for tennis, basketball, hand-
ball, outdoor, and training has been a
success, and sales projections for 1997
indicate a sharp rise in volume; the introduc-
tion of Feet You Wear running shoes should
guarantee another blockbuster year. With
Feet You Wear, adidas demonstrates once
again that its tradition of technological
breakthroughs remains strong and enduring.
It is a heritage that will continue to power its
trajectory in the marketplace race worldwide.
The year 1996 was the first full year for
adidas as a public company; it also proved
to be the best year in company history in
terms of financial results. Strong growth in
sales and profitability continued. For the third
year in a row, adidas can report record fig-
ures, despite significant marketing invest-
ments in the brand to assure sustained
growth in the future.
Operational and financial results for 1996
were outstanding, with net sales increasing
by 35% to DM 4.7 billion and income before
tax by 50% to DM 444 million, as earnings
per share increased by 28% to DM 6.93 for
the year. Financial leverage decreased signifi-
cantly as working capital requirements from
increased business volume and the purchase
of new subsidiaries could be financed
with internally-generated cash. The financial
community took note of adidas’ perfor-
mance, helping to boost the share to out-
perform the DAX by 44% since the Initial
Public Offering in November 1995 through
December 31, 1996.
Moving into 1997, adidas is geared to suc-
ceed in a highly competitive environment
and we are committed to sustained growth
in both sales and profit. Our business out-
look is strong; the order backlog for 1997 is
up substantially over last year’s at the same
time, demonstrating the tremendous accep-
tance of our brand and products by both the
trade and consumers.
Results in 1996 have put adidas back where
it belongs – in the top league at the very
heart of sports. That is, at the same time, our
heritage and our motivation. That tradition –
proven each day – continues to inspire ath-
letes, their fans, and consumers worldwide.
That is also the meaning behind our new
streamlined corporate logo featuring the
legendary three stripes; this ultimate seal of
sporting excellence will accompany the
adidas brand and its own ever-growing
numbers of committed fans into the next
millennium with the clear identity of the best
sports brand in the world.
Sports is our passion and our future, a true
universal language where the value of the
adidas brand is both our legacy and our
springboard to the next century. And adidas
is fit for the challenges of the global market-
place. We have a clear mission and vision.
We have defined specific strategies accept-
ed and implemented enthusiastically by a
highly-dedicated international management
team and by employees who demonstrate
their personal commitment to the brand and
to our customers each day. In short, we all
have everything we need – especially the will
– to win.
Robert Louis-Dreyfus