Norwegian Bjorn Golden will hold his first quarterly presentation as CEO of crisis-hit sports giant Adidas, which has a market capitalization of more than NOK 300 billion, on Wednesday morning.
All the negative events that surrounded the artist Kanye West, or simply “Yi” as he now calls himself, cast a dark shadow on the German giant of sports shoes and equipment – which is also evidenced by the financial results.
In the fourth quarter, Adidas posted an operating loss of €724 million, equivalent to NOK 8.2 billion, according to the latest steamy report. 2022 as a whole ended with an operating profit of nearly NOK seven billion.
The company achieved sales of approximately NOK 59 billion in the fourth quarter, up slightly from the previous year. The company received approximately NOK seven billion in lost sales as a result of secession from the West.
Notification of the result of cracking
West and Adidas formalized the partnership in 2016, but the Germans saw each other last fall Having to sever ties with the artist after a series of racist and anti-Semitic outbursts from the West.
In an earnings announcement last month, Adidas wrote that the company is burning with merchandise worth billions of crowns associated with West, specifically the “Yeezy” brand, which accounted for about eight percent of all Adidas sales in 2021.
Adidas has calculated that Yeezy will cost Adidas €1.2 billion in lost sales, €500 million in net profits and €200 million in one-time costs this year alone. Those numbers are repeated in its fourth-quarter report, where Adidas writes that it expects an operating loss of close to NOK eight billion also in 2023. This assumes that Adidas chose not to rebrand and sell any of its Yeezy equipment.
Golden says 2023 will be used to lay the foundations for profitability in 2024.
Adidas has all the ingredients to be successful. But we need to bring the focus back to our core: product, consumers, retail partners and athletes. We’ll work to strengthen our team and Adidas culture,” Golden says.
Adidas pays a dividend of €0.7 per share in the fourth quarter, versus a previous estimate of €1.64.
68 million won
Bjørn Gulden announced his move to Adidas from arch-rival Puma last fall, starting at the turn of the year. On the day the change in management was announced, Adidas rose nearly 20 percent on the Frankfurt Stock Exchange, after the stock had been in a long and seemingly endless decline.
Golden grew up in Hallingdal and was a professional footballer, including at Germany’s Nuremberg in the 1980s, but injury brought his footballing career to an early end. Instead, he got into the sports equipment and textile industries, holding, among other things, various management positions at Adidas.
Golden is also the Chairman of the Board of Directors of the commercial giant Saling Group. He previously held positions on the board of directors of Norwegian furniture manufacturer Ekornes, electronics retailer (now Power) and Helly Hansen.
In terms of salary, Golden ranks first among German business leaders in the DAX industrial index, according to Handelsblatt. As Puma manager, in 2021 he had a gross wage of €6.7 million, or NOK 68 million. Most of the payments were bonuses.
According to Handelsblatt, retired Adidas CEO Kasper Rørstedt earned nearly NOK 90 million in 2021.
According to the 2022 annual report, Rørstedt received a one-off payment of at least €12 million for the early termination of the contract, equivalent to NOK 135 million. He will also receive €200,000 as a monthly bonus for 18 months. (conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We’d like you to share our statuses using links that lead directly to our pages. Reproduction or other use of all or part of the Content may be made only with written permission or as permitted by law. For more terms see here.
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