The Adidas Financial Performance From Time to Time
Along with business development, many investors want to invest in Adidas because of the business prospects of this company. Based on the majority shareholders until August 2023, There are 5 Biggest of ownership in Adidas. The 5 largest shares of Adidas AG is BBR Partners LLC with share ownership of 0.04%, followed by Madison Asset Management LLC (0.01%), Mar Vista Investment Partners LLC (0.01%), Russell Investment Management LLC (0.01%), Kempner Capital Management, Inc. (0.01%).
Historically, this company started with Adolf Dassler creates the sports shoes in his mother’s house together with his elder brother, Rudolf Dassler. On its way, the difference in their views, principles, and incompatibility between Adolf and Rudolf makes them to break up. They work separately. Finally, Adolf established Adidas and Rudolf became the founder of Puma. Officially, in relation to Adidas, this company, Adidas, was founded in July 1924 by Adolf Dassler.
For its long journeys in the Sports Apparel business, Adidas has a special identity in its products. The three stripes also became the identity of Adidas. Now, operationally, this company has its main office in Herzogenaurach, Bavaria, Germany. Based on the country’s production, some production areas are in some regions, especially in Asia with a partnership agreement with local producers. The footwear production were concentrated in Indonesia, Vietnam, and China. The Apparel production was produced mainly in Cambodia, China, and Vietnam. The accessories and Gear were produced in China, Turkey, and Pakistan.
Because of the success of their business, Adidas can sponsor some events, clubs, tournaments, and famous sports athletes. Some famous athletes have big contracts with Adidas. Lionel Messi, Mo Salah, David Beckham, and the other athletes are some of the famous athletes that have cooperated with Adidas. At the level of clubs, some famous clubs are also interested in cooperating with Adidas. They have big contracts with Adidas. Real Madrid, Juventus, and Manchester United are some of the clubs that have contracts with Adidas.
The assets, Liabilities, and Equities of Adidas.
| Years | Assets | Liabilities | Equities |
|---|---|---|---|
| Million Euro | Million Euro | Million Euro | |
| 2009 | 8,875 | 5,099 | 3,776 |
| 2010 | 10,618 | 5,995 | 4,623 |
| 2011 | 11,380 | 6,049 | 5,331 |
| 2012 | 11,651 | 6,360 | 5,291 |
| 2013 | 11,599 | 6,118 | 5,481 |
| 2014 | 12,417 | 6,799 | 5,618 |
| 2015 | 13,343 | 7,695 | 5,648 |
| 2016 | 15,176 | 8,721 | 6,455 |
| 2017 | 14,552 | 8,117 | 6,435 |
| 2018 | 15,612 | 9,248 | 6,364 |
| 2019 | 20,680 | 13,622 | 7,058 |
| 2020 | 21,053 | 14,599 | 6,454 |
| 2021 | 22,137 | 14,618 | 7,519 |
| 2022 | 20,296 | 14,945 | 5,351 |
| 2023 18,020 13,095 4,925 Source : Adidas AG Annual Report, 2009-2023 | |||
Based on the Financial Position of Adidas from 2009 to 2022 (Balance sheet), this company keeps stable in guarding its position. In 2009, the assets of Adidas were just 8.8 billion Euro and Equities around 3.7 billion Euro. Meanwhile, after a decade, in 2023, the assets become 18 billion euros and equities around 4.9 billion euros.
The Revenue and Net income of Adidas
| Years | Revenue | Net Income |
|---|---|---|
| Millions Euro | Millions Euro | |
| 2009 | 10,381 | 245 |
| 2010 | 11,990 | 568 |
| 2011 | 13,344 | 670 |
| 2012 | 14,883 | 524 |
| 2013 | 14,492 | 790 |
| 2014 | 14,534 | 496 |
| 2015 | 16,915 | 640 |
| 2016 | 18,438 | 1,020 |
| 2017 | 21,218 | 1,100 |
| 2018 | 21,915 | 1,704 |
| 2019 | 23,640 | 1,977 |
| 2020 | 18,435 | 443 |
| 2021 | 21,234 | 2,158 |
| 2022 | 22,511 | 638 |
| 2023 21,427 -14 Source : Adidas AG Annual Report, 2009-2023 | ||
In the financial performance aspects, Adidas AG can keep a consistent net income/profit from 2009 to 2022. Meanwhile, in 2023, Adidas suffered net losses of 14 million Euro. Based on the consolidated income statement of Adidas, the revenue of Adidas in 2009 reached 10.3 billion Euro, with a net income of around 245 million Euro. Meanwhile, in 2023, the revenue of Adidas becomes 21.4 billion Euro with net losses around 14 million Euro.
Based on some financial ratios, Adidas showed some value in its financial indicators. The Debt to equity ratio is about 1.62. This value is the average value from 2009 to 2023. Basically, the value of 1.62 means that every one dollar of equity contains liabilities of about 1.6 US dollars. Meanwhile, the value of the debt to asset ratio (DAR) is about 0.60 on average. Basically, it means that the value of liabilities is 60 % of the assets, or it means that every one dollar of an asset can contain 0.60 US dollars of liability. The value of the Debt to equity ratio (DER) and Debt asset ratio (DAR) showed the financial structure of the company. This value should be low because the lower the value, the better and the healthiest the company.
,%20Debt%20To%20Assets%20Ratio,%20and%20Net%20Profit%20Margin%20(NPM).jpg "The Debt-to-equity Ratio, Debt to Assets Ratio, and Net Profit Margin of Adidas From 2009 to 2023")
Based on the performance of the company, the Net profit margin (NPM), Adidas’s NPM value is around 0.04 or 4.7 %. Basically, this value means that the net income of the company is about 4.7 % of the revenue. Overall, this indicator describes the efficiency of the company in doing its business.
In terms of business performance in 2023, based on the geographical regions, the main source of revenue / sales of adidas was located in Europe, Middle East, and Africa (EMEA) which contributing of sales around 8.2 billion Euro into Adidas AG. Meanwhile, North America can give the revenue around 5.2 billion Euro and Greater china with 3.1 billion Euro. Furthermore, in the kind of Adidas’s products, The Footwear and Apparel Products still become the main source of revenue. The financial contribution of footwear products are 12 billion Euro and Apparel products can give 7.8 billion Euro to Adidas.
Bibliography of Adidas Financial Performance From Time to Time.
Adidas. 2024. Financial Report. Accessed via https://www.adidas-group.com/en/investors/financial-reports/ on March 30th, 2024.