Adidas 1996 Annual Report Download - page 53

Download and view the complete annual report

Please find page 53 of the 1996 Adidas annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 68

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68

Earnings available for dividend distributions are determined by reference to the
retained earnings of adidas AG calculated under German commercial law.
The Board of Directors will recommend to the annual general meeting that the un-
appropriated earnings of adidas AG at December 31, 1996 should be appropriated
as follows (in thousands):
Dividend of DM 1.10 per ordinary share DM 49,884
The remaining balance is to be carried forward to the new year DM 349,459
Unappropriated earnings as of December 31, 1996
DM
399,343
12. Leasing arrangements The Company leases space for its offices, warehouses and equipment under leases
expiring from one to nine years. Rent expense aggregated DM 61 million, DM 49
million and DM 53 million for the years ended December 31, 1996, 1995 and 1994,
respectively. Amounts of future minimum lease payments under significant non-
cancellable operating leases for the succeeding five years 1997 through 2001 are
approximately DM 51 million, DM 33 million, DM 23 million, DM 14 million and DM 9
million, respectively. Amounts of future minimum lease payments after 2001 are
approximately DM 13 million.
Additionally, the Company conducts a portion of its operations from leased facilities
in France. The lease, which is for fifteen years expiring in 2004, is classified as a
capital lease. The value of facilities under this capital lease, net of accumulated
depreciation, of approximately DM 5 million and DM 5 million at December 31, 1996
and 1995, respectively, is included in land, land rights, and buildings. The future
minimum lease payments under this capital lease, which are payable through the
year 2004, amounted to approximately DM 3 million at December 31, 1996.
13. Employee benefit plans The Company sponsors and/or contributes to various pension plans, primarily in
Germany. The Company’s plans cover substantially all German employees. The
liabilities related to these plans of approximately DM 38 million and DM 27 million at
December 31, 1996 and 1995, respectively, are included in other long-term
liabilities. The aggregate amounts vested in Germany under these plans were DM 10
million and DM 9 million at December 31, 1996 and 1995, respectively. Additionally,
the Company borrowed approximately DM 17 million at December 31, 1996 and
1995, respectively, from its pension trust fund in Germany. This amount is also
included in other long-term liabilities. As of January 1, 1996, this amount bears
interest at the average Deutsche Bundesbank public bond rate of 5.46% as fixed at
the beginning of the year. In 1995, the amount had an interest rate at the German
discount rate plus 2%. The Company’s plans include both defined contribution
plans and defined benefit plans as described below.
53