Adidas 1998 Annual Report Download - page 62

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60 Notes to Consolidated Financial Statements
The Company does not recognize deferred tax liabilities for unremitted earnings of
non-German subsidiaries, which are expected to be permanently invested in international
operations. The earnings could become subject to additional tax if they were remitted as
dividends, or if foreign earnings were loaned to the Company, or if the Company should
sell its stock in the subsidiaries. The Company estimates that the distribution of these
earnings would result in DM 20 million and DM 18 million of additional withholding taxes
as of December 31, 1998 and 1997, respectively.
23. SEGMENTAL INFORMATION
The Company operates predominately in one industry segment, the design, wholesale
and marketing of athletic and lifestyle products. The Company is currently managed on
the basis of a regional reporting structure and by brand. Certain functions of the Company
are centralized and an allocation to specific segments is not considered to be meaningful.
Information about the Company’s segments in accordance with the management
approach is presented below:
SEGMENTAL INFORMATION FOR THE adidas-Salomon GROUP BY BRANDS
Taylor HQ/Con- Total
(in DM million) adidas Salomon Made Mavic solidation group
1998 1998 1998 1998 1998 1998
Net sales (third parties) 8,441 850 514 102 0 9,907
Net margin 3,556 332 230 36 0 4,154
in % of net sales 42.1 39.0 44.7 35.2 – 41.9
Operating result 806 (3) 30 1 0 834
Total assets 3,454 1,136 166 48 1,466 6,270
SEGMENTAL INFORMATION FOR THE adidas-Salomon GROUP BY REGIONS
Asia/ Latin HQ/Con- Total
(in DM million) Europe America Pacific America solidation group
1998 1998 1998 1998 1998 1998
Total net sales 5,711 3,555 750 219 4,062 14,297
Inter-segment sales (285) (65) 0 0 (4,039) (4,389)
Net sales (third parties) 5,426 3,489 750 219 23 9,907
Net margin 2,204 1,395 305 85 165 4,154
in % of net sales 40.6 40.0 40.7 39.0 – 41.9
Operating result 699 539 50 22 (476) 834
Total assets 2,647 1,284 407 144 1,788 6,270