We can save Adidas despite Kanye furore, insists chief
ADIDAS is to cut its shareholder dividend as it battles to shift €1.2bn (£1.1bn) of unsold trainers after abandoning a deal with Kanye West over the rapper’s anti-semitic rants.
The sportswear brand warned that failure to offload the stock would result in its operating profit declining by €500m and lead to its first annual loss in more than three decades.
However, the company insisted it could rebuild its reputation.
Bjørn Gulden, chief executive of Adidas, said: “We need to reduce inventories and lower discounts. We can then start to build a profitable business again in 2024.
“Adidas is a fantastic brand, a fantastic company with great infrastructure and great talented people. We will bring it back to be the best sports brand in the world once again.”
Adidas said there was just a 15pc to 30pc chance it will sell the items from its Yeezy brand, designed by West.
The company has now proposed cutting its annual payout to investors by 79pc to 70 cents per share, causing Adidas’s share price to slump 3pc yesterday. West developed the Yeezy brand in partnership with Adidas, launching the clothing range in 2015. The American rapper, who has changed his name to Ye, had previously launched trainers with rival shoe brand Nike.
Yeezy trainers and apparel were contributing $1bn (£800m) of annual sales for Adidas. The partnership ended in October after West’s remarks. On Oct 9, West had tweeted he intended to “go death con 3 on Jewish people”, and made remarks suggesting his critics and the media are controlled by Jews.
A week later, West said on a podcast: “I can say anti-semitic things, and Adidas can’t drop me. Now what?”
Adidas called time on the partnership days later, saying it “does not tolerate anti-semitism and any other sort of hate speech. It said: “Ye’s recent comments and actions have been unacceptable, hateful and dangerous, and they violate the company’s values of diversity and inclusion, mutual respect and fairness.”
Adidas said it faced additional one-off costs of up to €200m from the termination of its deal with West.