What: sportswear maker vows to double shareholder payouts as it seeks to boost profits through direct sales

Why is it important: by 2025, Adidas aims to sell every other product directly to consumers, compared with 33% before the pandemic

Adidas has vowed to double payouts to shareholders to up to EUR 9 billion over the next five years, as it seeks to lift profits by increasingly selling direct to consumers.

Chief executive Kasper Rorsted unveiled a plan to lift revenues by roughly a third to more than EUR 30 billion a year by 2025, promising that 80% of that growth would be generated by Adidas’s own online and physical stores.

Ecommerce is expected to be the biggest driver of growth as the world’s second-largest sports brand seeks to double online sales by 2025 to up to EUR 9 billion. EUR 2 billion will be invested in marketing and digital operations. “Building direct relationships with its target audience plays an increasingly important role,” Adidas said.

The company’s new “Own the Game” strategy targets annual revenue growth of 8 to 10% a year compared to average industry 6-7%. For 2020, the Covid-19 pandemic led to a 78% decline in net profit to EUR 432 million, but expects a strong top-line recovery in 2021, with a revenue rise of 15 to 19%.

Alongside its strategy for growth, Rorsted also pledged to bolster Adidas’s green credentials, saying the group planned to increase the share of products made from “sustainable materials” from 60% today to 90% over the next five years.

Adidas aims to cut out retailers in renewed push for growth