ASSIGNMENT-2

STRATEGIC MANAGEMENT
ANALYSIS OF THE SPEECH DELIVERED BY HERBERT HAINER IN
THE ANNUAL GENERAL MEETING OF
ADIDAS AG


SUBMITTED TO:
Dr.A.VISWANATHAN
DIRECTOR
TIM

SUBMITTED BY:
SRIKANTH B
S4-A
TIM
SUBMISSION DATE: 17/06/2014


ANALYSIS OF THE SPEECH DELIVERED BY HERBERT HAINER IN THE
ANNUAL GENERAL MEETING OF
ADIDAS AG
On
May 8th, 2014

Adidas AG is a German multinational corporation that designs and manufactures sports
shoes, clothing and accessories based in Germany.
In his speech, He covered the topics on:
Business development in 2013.
Our outlook for the current year.
A look at our Route 2015 strategy.
Most recent changes on our Executive Board

He also mentioned about certain constraints that affects the companys sales.
Some of them are -:
Firstly, distribution constraints in Russia following the go-live of the new distribution
centre.
Secondly, a stalling global golf market.
And thirdly, negative currency developments.

He also points out the key financial datas about the company which is as follows
Adidas Group sales were up 3% on a currency-neutral basis. In euro terms, however, sales
declined 3% to 14.5 billion.
Gross margin increased 1.5 percentage points to 49.3%. This is a new record level.
Operating margin excluding goodwill impairment losses increased 70 basis points to 8.7%.
Net income attributable to shareholders excluding goodwill impairment losses rose 6% to
839 million. This, too, is a new record level.
The equity ratio expanded 1.8 percentage points to 47.3%.
Net cash at year-end amounted to 295 million.
After pointing out this datas he proudly represent the companys strong financial stability.
He also mention about their healthy balance sheet.
He quoted out certain facts about the functioning of the company in the year 2013
Football grows in 2013
As the Official Partner of the 2014 FIFA World Cup in Brazil, Adidas will be the
most visible Brand during the event. We equip nine of the qualified teams, including
four of the leading
Teams in the FIFA world ranking: Spain, Argentina, Colombia and, of course,
Germany. Overall, we expect to achieve record sales of 2 billion in the football
category in the year of the World Cup, further strengthening our position as the
number one in football.
Adidas NEO to open more stores
After successfully piloting Adidas NEO stores in Germany in 2012 and 2013, we are
extending our test phase this year by opening further NEO stores in Poland and the
Czech Republic. New 10 stores will also open their doors in Germany. Adidas NEO
Label currently has the most fans in China, where our young fashion collection is
already available in more than 1,000 stores. This means our long-term goal to grow
NEO into a one billion euro business worldwide is not far off.
Reebok leverages partnerships
We also have good news to report about Reebok. The brand will continue to grow in
2014, as we leverage our strategic collaborations with the fast-growing fitness
movement Cross Fit, the obstacle racing series Spartan Race and the world's leading
provider of group fitness programmes Les Mills. These partnerships underline
Reebok's clear positioning as THE fitness brand.
Taylor Made-Adidas Golf remains number one in golf
The golf market will remain difficult in 2014. Nevertheless, Taylor Made-Adidas
Golf will sustain its leadership in the golf market with game-changing products such
as the SLDR driver and the adizero, One golf shoe, which is the lightest golf shoe in
the company's history.

He then mentioned about territory wise sales of Adidas
Adidas takes market share in China
Growth fuelled in Latin America
Sales increased in Russia
Sales lowered in North America
He points out certain growth strategies of the company
Growing importance of sustainable products
Adidas Group awarded as attractive employer
More than 50,000 employees worldwide
Winning the global consumer

Further growth expected in 2014
We expect to further grow our top and bottom line in 2014.
We will achieve high-single-digit sales growth.
Gross margin already at a record level in 2013 will further improve, driven by a
more favourable pricing, product and regional sales mix.
We also intend to improve our bottom line compared to 2013.


First quarter 2014 results
Group revenues remained stable on a currency-neutral basis. The zero sales growth
is due to TaylorMade-adidas Golf where, as a result of the ongoing challenging
environment in the golf market, sales declined 34%. At our core brands Adidas and
Reebok, sales increased 5% and 3%, respectively.
Basic earnings per share decreased 34%.

He also mentioned about the companys future plan i.e. to contribute for the long-
term growth and sustainable success of the company.
We will drive high-single-digit currency-neutral sales growth.
In euro terms, we will grow our bottom line at a much faster rate than the top line.
I am also confident that we will achieve our target of a double-digit compound
annual growth rate for our earnings per share within the Route 2015 period. However,
this is assuming that currencies do not worsen materially.


He concluded his speech by pointing about the current challenges and growth of the
company.
At last he mentioned about the future cooperation with the companies allies and he
also congratulate all the employees who contribute for the success of the company.