Ag 2017 en Secured PDF

F I N A N C I A L S TAT E M E N T S
O F A D I DAS AG
FOR THE YEAR ENDED

DECEMBER 31, 2017
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CONTENTS
3 Information on the combined Management Report
4 Balance Sheet
5 Income Statement
6 Notes
43 Statements of Changes in Fixed Assets
45 Supervisory Board and Executive Board
52 List of Shareholdings
55 Auditors’ Report
56 Responsibility Statement
67 Supervisory Board Report

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Combined Management Report
The Management Report of adidas AG has been combined with the Management Report of
the adidas Group in accordance with § 315 section 5 together with § 298 section 2 of the
German Commercial Code (Handelsgesetzbuch – HGB) and is published in the 2017 Annual
Report of the adidas Group.
The Financial Statements and the combined Management Report for adidas AG and the
adidas Group for the 2017 financial year are filed with and published in the Federal Gazette.
The Financial Statements of adidas AG as well as the Annual Report for the 2017 financial
year are also available for download on the Internet at
http://www.adidas-group.com/en/investors/financial-reports/
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Annual financial statements of adidas AG
Balance Sheet
EUR thousand
Dec. 31, 2017 Dec. 31, 2016
ASSETS
FIXED ASSETS (1)

Intangible assets (2) 123,855 112,174
Tangible assets (2) 610,237 492,644
Financial assets (3) 4,308,135 4,205,439
5,042,227 4,810,257
CURRENT ASSETS
Inventories (4) 48,876 49,514
Receivables and other assets (5) 3,261,565 2,968,936
Cash and cash equivalents (6) 337,219 27,853
3,647,660 3,046,303
PREPAID EXPENSES (7) 168,372 142,789
ACTIVE DIFFERENCE RESULTING FROM ASSET OFFSETTING (8) 4,971 3,917

8,863,230 8,003,266
EQUITY AND LIABILITIES
EQUITY
Subscribed capital 1) (9) 209,216 209,216
Par value treasury shares (9) -5,355 -7,727
Capital reserves (9) 1,309,932 1,260,865
Revenue reserves 616,842 304,036
Retained earnings (10) 573,314 628,908
2,703,949 2,395,298
UNTAXED RESERVE (11) 3,432 3,754
PROVISIONS/ACCRUALS (12) 624,043 525,005
LIABILITIES (13) 5,530,596 5,078,174
DEFERRED INCOME 1,210 835

8,863,230 8,003,266
1) Contingent Capital 2010 at Dec. 31, 2017 in the amount of EUR 36,000 thousand (previous year EUR 36,000
thousand).
Contingent Capital 2014 at Dec. 31, 2017 in the amount of EUR 12,500 thousand (previous year EUR 12,500
thousand)
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Annual financial statements of adidas AG
Income Statement
EUR thousand
2017 2016
Sales (15) 3,732,306 3,288,775

Change in inventory -596 969
Total output 3,731,710 3,289,744
Other operating income (16) 502,724 439,195

Cost of materials (17) -1,292,482 -1,127,380
Personnel expenses (18) -692,064 -587,891
Amortization and write-downs of intangible fixed assets and
depreciation and write-downs of tangible fixed assets (19) -90,555 -100,409
Other operating expenses (20) -2,169,678 1,803,408
Income from operations -10,345 109,851
Income from investments in related companies (21) 155,420 624,546

Profit received under a profit and loss transfer agreement (22) 501,391 1,562
Loss taken over under a profit and loss transfer agreement (22) -829 -4,418
Write-downs of long-term financial assets (23) 0 0
Interest result (24) 247 -21,344
Taxes on income (25) -96,188 -92,606
Income after taxes 549,696 617,591
Other taxes -242 -301

NET INCOME 549,454 617,290
Retained earnings brought forward 23,860 322,325

Transfer to other revenue reserves 0 -300,000
Utilization for share buyback 0 -10,707
RETAINED EARNINGS 573,314 628,908
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Notes to the annual financial statements of adidas AG for the

year ended December 31, 2017
adidas AG is domiciled in 91074 Herzogenaurach, Adi-Dassler-Str. 1, and is

registered in the commercial register of the Local Court of Fürth, under HRB 3868.
In the interest of providing a clearer overall picture, certain items in the balance
sheet and income statement have been combined as permitted pursuant to § 265 (7)
German Commercial Code (Handelsgesetzbuch, “HGB”), and have been disclosed
and explained separately under the numerical text reference indicated below. The
names and domiciles of other companies in which adidas AG holds at least a one-fifth
interest, either directly or indirectly, and the disclosures related to these companies
can be found in Appendix 3 to these notes.
Due to rounding principles, numbers presented may not sum up exactly to totals
provided.
Accounting policies
Acquired intangible fixed assets are recognized at cost and subject to periodic
straight-line amortization over their expected useful lives. Internally generated
intangible assets are not capitalized.
Tangible fixed assets are recognized at (acquisition or production) cost. All
recognizable direct and overhead costs are included in production costs. Items with a
finite life are depreciated/amortized over their expected useful lives. Borrowing cost
capitalization does not take place.
Buildings are subject to straight-line amortization at adidas AG. The estimated useful
life of business premises is 50 years maximum and from two to ten years for
technical equipment and machinery, other equipment, and operating and office
equipment.
Movable assets are depreciated on a straight-line basis.
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Minor-value assets worth less than EUR 410 are written off in full in the year of their
acquisition.
Write-downs to the lower fair value are also recognized if an impairment is
anticipated to be other than temporary.
Long-term financial assets are recognized at cost. To the extent necessary, write-
downs are made to their lower fair value. If the reasons for the write-down no longer
apply, the write-down is reversed to no higher than the historical cost of the asset.
Inventories are measured at the lower of cost or market. Manufacturing costs
comprise direct costs that must be capitalized and appropriate portions of overhead
costs. Allowances are taken for discernible fashion and technical risks, age
structure, and marketability. Borrowing cost capitalization does not take place.
Receivables and other assets are generally recognized at nominal values. Individual
adjustments and allowances for doubtful accounts are taken to cover discernible
risks.
Derivative financial transactions entered into with banks by Group Treasury
(primarily forward currency and currency option transactions as well as equity
instruments) are generally related to underlying transactions with Group companies.
Hedge accounting is applied if there is a direct hedging relationship between these
transactions. The net hedge presentation method is applied. The fair values of the
hedges are matched and changes in value from the hedged risk which offset each
other are not recognized. Unrealized losses are recognized in profit or loss only if
they are not covered by unrealized gains in the hedge accounting. Financial
transactions that are not recognized using hedge accounting are measured
individually at fair value. Any resulting losses are recognized in profit or loss.
Prospectively, due to the common material assessment features of the transactions,
the hedging relationship can be assumed to be highly effective. Retrospectively, the
effectiveness is proven by means of the hypothetical derivative method. The dollar-
offset method is used for calculation of the amount of ineffectiveness. Cash-in-hand
and bank balances are recognized at nominal value.
Prepaid expenses are recognized at nominal value.
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Deferred taxes are recognized for temporary differences between the carrying
amounts and tax bases for assets, liabilities, prepaid expenses and deferred income.
Deferred taxes are calculated based on the combined income tax rate of adidas AG,
which is currently 28%. The combined income tax rate comprises corporate income
tax, municipal trade tax and the solidarity surcharge.
A net tax burden would be recognized on the balance sheet as a deferred tax liability.
There is an option to recognize a deferred tax asset under § 274 (1) no. 2 HGB in the
event of a tax benefit granted but this option is not exercised. In the fiscal year, the
Company had a net deferred tax asset, which it did not recognize on its balance
sheet.
Subscribed capital is recognized at the nominal amount.
The Company exercised its option to maintain the special tax-allowable reserve as
permitted upon the first-time adoption of the German Accounting Law Modernization
Act (Bilanzrechtsmodernisierungsgesetz, “BilMoG”). Accounting policies relating to
this reserve and its reversal remain the same as previously.
Pension obligations are calculated on the basis of actuarial biometric assumptions
(2005 G mortality tables by Prof. Dr. Klaus Heubeck) in accordance with the projected
unit credit (PUC) method. The defined benefit obligation (DBO) recognized under the
PUC method is defined as the actuarial present value of the pension obligations
earned by the employees by the balance sheet date according to the retirement
benefit formula and the vested pension amount based on their service in the past.
Expected future pension benefit increases are factored in using a 1.0% to 1.5% p.a.
growth rate in benefits. The entitlement dynamic lies between 0% and 3% p.a.
Fluctuation is assumed to range between 5% and 20%, depending on age. The rate
used to discount the pension obligations in accordance with § 253 (2) sentence 2 HGB
amounts to 3.68% as at December 31, 2017 (prior year: 4.00%); this rate is the
average market interest rate for the past ten fiscal years for an assumed term of 15
years. In accordance with § 253 (6) sentence 2 HGB, the difference between the
application of the average market interest rate for the past seven fiscal years 2.80%
(prior year: 3.22%) and the application of the average market interest rate for the
past ten fiscal years 3.68% (prior year: 4.00%) is subject to a restriction on
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distribution. The significant reduction in the interest rate compared to the previous
year is due to the low-interest phase. The plan assets created in 2014 through the
funding of the pension trust association were measured at fair value in accordance
with § 255 (4) HGB and offset against the pension obligations.
Other provisions cover all discernible risks and uncertain obligations and are
recognized in the settlement amount dictated by prudent business judgment in order
to cover future payment obligations. Future price and cost increases are factored in
to the extent that there is sufficient objective evidence that they will occur. Provisions
with terms in excess of one year are discounted at the average market interest rate
for their respective maturity over the past seven years, in accordance with § 253 (2)
sentence 1 HGB. Provisions with terms of less than one year are not discounted.
Net income from the discounting of retirement pension obligations is shown in the
income statement under the item “other interest and similar income” and net
expenses under the item “interest and similar expenses”, as part of the financial
results.
For the remaining partial and early retirement liabilities, discounting was waived due
to the low residual maturity (in the previous year, discounting at 1.70%). The
liabilities for partial and early retirement are recognized in “active difference
resulting from asset offsetting” as this constitutes an asset item.
The securities used for this and classified as current assets serve exclusively to
satisfy liabilities from partial and early retirement obligations and are isolated from
all other creditors. In accordance with the provisions of HGB, these assets must be
offset against the liabilities for which they serve as hedges. Analogously to the
offsetting of assets against liabilities, the associated income from securities is offset
against interest expenses. The assets to be offset are measured at fair value as
determined by their current exchange or market price. Any difference arising
between the fair value and historical cost of the assets to be offset is subject to a
restriction on distribution.
The effect from the annual adjustment of the discount rate applied to the provisions
in accordance with § 253 (2) HGB is recognized immediately in profit and loss.
Liabilities are recognized at their settlement amount.
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Revenues are recognized once the price risk has been transferred to the purchaser.
This generally occurs upon delivery of the merchandise.
Licensing revenues are recognized in accordance with the underlying contractual
agreements. Claims and revenues generally arise whenever the licensee generates
sales revenue with adidas products.
Assets and liabilities denominated in a foreign currency are recorded at the mean
spot rate as at the respective transaction date. Currency translation losses arising as
at the balance sheet date due to the measurement of foreign-denominated assets
and liabilities are reported. Currency translation gains from the measurement of
current assets and liabilities falling due within less than one year are recorded in
profit or loss in accordance with § 256a HGB. Currency translation gains are reported
under “other operating income” and currency translation losses are reported under
“other operating expenses”.
Profit or loss resulting from a profit and loss transfer agreement is recognized if the
amount to be transferred or absorbed can be determined with reasonable certainty,
even if the annual financial statements of the subsidiary have not yet been adopted.
Income from long-term equity investments is generally recognized during the period
in which a claim to such income arises and it can be reasonably expected that the
amounts due will be collected.
1. Fixed assets
Please see Appendix 1 to the notes on the financial statements for the statement of
changes in fixed assets pursuant to § 268 (2) HGB.
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2. Intangible fixed assets and tangible fixed assets
Intangible fixed assets and tangible fixed assets

EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Balance as of Jan. 1 604,818 567,354
Additions 227,559 143,343
Disposals 7,730 5,470
Depreciation, amortization and write-downs 90,555 100,409
Reversals 0 0
Balance as of Dec. 31 734,092 604,818
The significant additions primarily relate to payments for assets under construction
in an amount of EUR 124,696 thousand. Further additions relate to software in an
amount of EUR 42,655 thousand and operating and office equipment in an amount of
EUR 11,540 thousand as well as computer hardware in an amount of
EUR 10,232 thousand. The disposals arise from the gross value of EUR 15,868
thousand and are reduced by accumulated depreciation incurred up to the date of
disposal in an amount of EUR 8,138 thousand.
3. Long-term financial assets
The increase in long-term financial assets primarily relates to a contribution in cash

for the share-based swap in an amount of EUR 62,453 thousand and loans granted to
adidas CDC Immobilieninvest GmbH in an amount of EUR 40,000 thousand.
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4. Inventories
Inventories
EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Raw materials, consumables and supplies 4,016 5,328
Work in progress 41 29
Finished goods and merchandise 44,819 44,157
Inventories 48,876 49,514
Inventories relate to raw materials, consumables and supplies for production

purposes, work in progress in the production process and merchandise at the
Company’s own retail stores and products in the “Y-3” collection.
5. Receivables and other assets
Receivables and other assets

EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Trade accounts receivable 95,074 84,467
of which with a residual maturity of more than one year 0 0
Receivables from affiliated companies 3,111,239 2,836,311
of which with a residual maturity of more than one year 0 0
Other assets 55,252 48,158
of which with a residual maturity of more than one year 13,323 14,828
Receivables and other assets 3,261,565 2,968,936
The receivables from affiliated companies primarily relate to receivables in

connection with Group Treasury activities. Group Treasury uses a netting process to
balance out any fund surpluses or deficits at subsidiaries through adidas AG and
settle payments between subsidiaries. Receivables from affiliated companies include
EUR 178,248 thousand in trade receivables.
The other assets essentially include receivables from Eurobond shares repurchased,
receivables from tax authorities from value added tax, receivables from withholding
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taxes, capitalized option premiums, accounts payable with debit balances and
receivables from credit card companies.
6. Cash-in-hand, central bank balances, bank balances and checks
Cash and cash equivalents

EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Cash-in-hand, bank balances and checks 337,219 27,853
7. Prepaid expenses
Prepaid expenses
EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Advertising and promotion agreements 87,202 59,834
Discount from valuation of conversion right attaching to convertible bond 0 4,823
Other 81,169 78,132
Prepaid expenses 168,372 142,789
In March 2012, adidas AG issued a convertible bond including prolongation option

maturing in 2019 at the latest with a value of EUR 500,000 thousand. The convertible
bond carries a 0.25 percent p.a. coupon and may be converted into shares in the
Company. The value of the conversion right was determined to be EUR 55,891
thousand, which was recorded as a discount under prepaid expenses. The discount
was completely amortized as of the earliest date possible, i.e. as of the June 2017
redemption by bond holders. The significant increase in advertising and promotion
agreements is largely attributable to the new DFB agreement. Other prepaid
expenses comprise mainly advance payments for licensing expenses, maintenance,
rent and insurance premiums.
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8. Active difference resulting from asset offsetting
The liabilities for partial and early retirement show a settlement amount of
EUR 354 thousand as at December 31, 2017 (prior year: EUR 1,396 thousand). The
fair value of recognized assets amounts to EUR 5,325 thousand as at December 31,
2017 (prior year: EUR 5,313 thousand) and the historical acquisition costs amount to
EUR 4,361 thousand (prior year: EUR 4,341 thousand). Pursuant to statutory
regulations, the difference between the fair value and the historical cost of the
recognized asset is subject to a restriction on distribution in an amount of EUR 964
thousand (prior year: EUR 972 thousand).
9. Subscribed capital and capital reserves
The nominal capital of adidas AG has remained unchanged since December 31, 2016.
As at the balance sheet date, and in the period beyond, up to and including February
23, 2018, it amounted to EUR 209,216,186 divided into 209,216,186 registered no-par-
value shares and is fully paid in.
Each share grants one vote and is entitled to dividends starting from the beginning of
the year it was issued. Treasury shares held directly or indirectly are not entitled to
dividend payment in accordance with § 71b German Stock Corporation Act
(Aktiengesetz – AktG). As at the balance sheet date, adidas AG held 5,354,952
treasury shares, corresponding to a notional amount of EUR 5,354,952 in the nominal
capital and consequently 2.56% of the nominal capital. As at February 23, 2018,
adidas AG holds 5,322,731 treasury shares, corresponding to a notional amount of
EUR 5,322,731 in the nominal capital and consequently 2.54% of the nominal capital.
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The table below provides an overview of the changes in equity:

Changes in equity
EUR thousand
Jan. 1, 2017 Repurchase Issuance of Allocation to Withdrawal Dividend Net profit Dec. 31, 2017
of treasury treasury reserves from for the year
shares shares / reserves
Conversion /
Employee
shares
Subscribed capital 209,216 0 0 0 0 0 209,216
Par value of -7,727 -473 2,845 0 0 0 0 -5,355

treasury shares
Capital reserves 1,260,865 0 46,473 2,594 0 0 0 1,309,932
Revenue 304,036 -70,135 183,970 200,000 -1,029 0 0 616,842

reserves*)
Retained earnings 628,908 0 0 -200,000 0 -405,048 549,454 573,314
Equity 2,395,298 -70,608 233,288 2,594 -1,029 -405,048 549,454 2,703,949
*) Includes legal reserves of EUR 4,036 thousand
Authorized capital
The Executive Board of adidas AG did not utilize the existing amounts of authorized
capital of up to EUR 90 million in the 2017 fiscal year or in the period beyond the
balance sheet date up to and including February 23, 2018.
The following overview of the existing amounts of authorized capital refers to § 4
sections 2, 3, 4 and 5 of the Articles of Association and consequently does not include
the Authorized Capitals 2013/I, 2013/III and 2015 canceled by the Annual General
Meeting on May 11, 2017, which had also not been utilized up to May 11, 2017.
The authorized capital of adidas AG entitles the Executive Board, subject to

Supervisory Board approval, to increase the nominal capital
until June 7, 2022

– by issuing new shares against contributions in cash once or several times by no
more than EUR 50 million and, subject to Supervisory Board approval, to exclude
residual amounts from shareholders’ subscription rights (Authorized Capital 2017/I);
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until June 7, 2020

– by issuing new shares against contributions in kind once or several times by no
shareholders’ subscription rights (Authorized Capital 2017/II);
until June 7, 2022

– by issuing new shares against contributions in cash once or several times by no
residual amounts from shareholders’ subscription rights and to exclude
shareholders’ subscription rights when issuing the new shares at a value not
essentially below the stock market price of the adidas AG shares already listed on
the stock exchange at the point in time when the issue price is ultimately
determined, which should be as close as possible to the placement of the shares;
this exclusion of subscription rights can also be associated with the listing of the
adidas AG shares on a foreign stock exchange (Authorized Capital 2017/III). The
authorization to exclude subscription rights pursuant to the previous sentence may,
however, only be used to the extent that the pro rata amount of the new shares in the
nominal capital together with the pro rata amount in the nominal capital of other
shares which have been issued by adidas AG since May 11, 2017, subject to the
exclusion of subscription rights pursuant to or in accordance with § 186 section 3
sentence 4 AktG on the basis of an authorized capital or following a repurchase, or
for which subscription or conversion rights or subscription or conversion obligations
have been granted since May 11, 2017, through the issuance of convertible bonds
and/or bonds with warrants, with subscription rights excluded in accordance with
§ 186 section 3 sentence 4 AktG, does not exceed 10% of the nominal capital existing
on the date of the entry of this authorization into the commercial register or – if this
amount is lower – as of the respective date on which the resolution on utilization of
the authorization is adopted; the overall amount of shares issued based on the
Authorized Capital 2017/III and the Authorized Capital 2017/II must not exceed 10% of
the nominal capital existing on the date of the respective issuance;
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until June 14, 2021

– by issuing up to 4,000,000 new shares against contributions in cash once or several
times by no more than EUR 4 million and, subject to Supervisory Board approval, to
determine the further content of the rights embodied in the shares and the terms
and conditions of the share issuance. Shareholders’ subscription rights shall be
excluded (Authorized Capital 2016). Any repurchased treasury shares of adidas AG
which are used by adidas AG for employee stock purchase plans during the term of
this authorization shall be attributed to the maximum number of 4,000,000 shares.
The new shares may only be issued to (current or former) employees of adidas AG
and its affiliated companies as well as to (current and former) members of
management bodies of adidas AG’s affiliated companies.
Contingent capital
The following description of the Contingent Capital is based on § 4 sections 6 and 7 of
the Articles of Association of adidas AG as well as on the underlying resolutions of
the Annual General Meetings held on May 6, 2010 and May 8, 2014. Additional
contingent capital does not exist.
Contingent Capital 2010 and Convertible Bond

The nominal capital of adidas AG is conditionally increased by up to EUR 36 million
(Contingent Capital 2010). The Contingent Capital serves the purpose of granting
holders or creditors of bonds that were issued up to May 5, 2015 based on the
resolution of the Annual General Meeting from May 6, 2010 subscription or
conversion rights relating to no more than a total of 36,000,000 shares in compliance
with the corresponding conditions of the bonds. The new shares will be issued at the
respective option or conversion price to be established in accordance with the
aforementioned authorization resolution. The new shares will carry dividend rights
from the commencement of the financial year in which the shares are issued.
On March 14, 2012, the Executive Board, with the approval of the Supervisory Board,
made partial use of the authorization of the Annual General Meeting on May 6, 2010,
and on March 21, 2012 issued a convertible bond due on June 14, 2019 (including a
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prolongation option) in a nominal value of EUR 500 million via an offer to institutional
investors outside the USA excluding shareholders’ subscription rights. In principle,
the conversion rights are exercisable at any time between May 21, 2012 and June 5,
2019, subject to lapsed conversion rights as set out under § 6 section 3 or to the
excluded periods as defined by § 6 section 4 of the bond terms and conditions, and
(subject to an adjustment of the conversion ratio resulting from the dilution
adjustment regulations set out under § 10 or a change of control in accordance with
§ 13 of the bond terms and conditions) based on a conversion price of EUR 81.13 per
share are convertible into 6,163,246 shares of adidas AG. The conversion price
currently amounts to EUR 81.13 per share. The convertible bond bears an interest
rate of 0.25% per annum. Bondholders are entitled to demand early redemption of
the bonds as of June 14, 2017. As of July 14, 2017, adidas AG may conduct an early
redemption of the bond, if, on 20 of 30 consecutive trading days, the share price of
adidas AG exceeds the current conversion price of EUR 81.13 by at least 30%. The
bonds are listed on the Open Market segment of the Frankfurt Stock Exchange.
Moreover, the authorization to issue bonds with warrants and/or convertible bonds
granted on May 6, 2010 was canceled by resolution of the Annual General Meeting on
May 8, 2014.
The Executive Board of adidas AG did not issue shares from the Contingent Capital
2010 up to the balance sheet date and in the period beyond the balance sheet date up
to and including February 23, 2018.
Contingent Capital 2014

At the balance sheet date, the nominal capital is conditionally increased by up to
EUR 12.5 million divided into not more than 12,500,000 shares (Contingent Capital
2014). The contingent capital increase will be implemented only to the extent that
holders or creditors of option or conversion rights or the persons obligated to
exercise the option or conversion duties based on bonds issued by adidas AG or a
subordinated Group company, pursuant to the authorization of the Executive Board
granted by the resolution adopted by the Annual General Meeting on May 8, 2014
(Agenda Item 7), up to May 7, 2019 and guaranteed by adidas AG, exercise their
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option or conversion rights or, if they are obliged to exercise the option or conversion
duties, meet their obligations to exercise the warrant or convert the bond, or to the
extent that adidas AG exercises its rights to choose to deliver adidas AG shares for
the total amount or a part amount instead of payment of the amount due and insofar
as no cash settlement, treasury shares or shares of another publicly listed company
are used to service these rights. The new shares will be issued at the respective
option or conversion price to be established in accordance with the aforementioned
authorization resolution. The new shares will carry dividend rights from the
commencement of the financial year in which the shares are issued. The Executive
Board is authorized, subject to Supervisory Board approval, to stipulate any
additional details concerning the implementation of the contingent capital increase.
Up to the balance sheet date and in the period beyond the balance sheet date up to
and including February 23, 2018, the Executive Board of adidas AG did not issue any
bonds based on the authorization granted on May 8, 2014 and consequently did not
issue any shares from the Contingent Capital 2014.
Repurchase and use of treasury shares

Against the background of the introduction of an employee stock purchase plan, the
Annual General Meeting of May 12, 2016 canceled the authorization of the Executive
Board to repurchase treasury shares granted on May 8, 2014, which was used in 2014
and 2015. At the same time, the Annual General Meeting granted the Executive Board
a new authorization to repurchase treasury shares up to an amount totaling 10% of
the nominal capital until May 11, 2021. The authorization may be used by adidas AG
but also by its subordinated Group companies or by third parties on account of adidas
AG or its subordinated Group companies or third parties assigned by adidas AG or
one of its subordinated Group companies.
Based on the authorization to repurchase treasury shares granted by the Annual
General Meeting on May 8, 2014, the adidas AG Executive Board commenced a share
buyback program on November 7, 2014.
Under the granted authorization, adidas AG repurchased a total of 4,889,142 shares
for a total price of EUR 299,999,987 (excluding incidental purchasing costs), i.e. for
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an average price of EUR 61.36 per share, in a first tranche between November 7,
2014 and December 12, 2014 inclusive. This corresponded to a notional amount of
EUR 4,889,142 in the nominal capital and consequently to 2.34% of the nominal
capital. The shares were repurchased for cancelation (capital reduction) or otherwise
used to meet obligations arising from the potential conversion of adidas AG’s EUR
500 million convertible bond.
Under the granted authorization, adidas AG repurchased a total of 4,129,627 shares
for a total price of EUR 299,999,992 (excluding incidental purchasing costs), i.e. for
an average price of EUR 72.65 per share, in a second tranche between March 6, 2015
and June 15, 2015 inclusive. This corresponded to a notional amount of EUR
4,129,627 in the nominal capital and consequently to 1.97 % of the nominal capital.
The shares were repurchased for cancelation (capital reduction) or otherwise used to
meet obligations arising from the potential conversion of adidas AG’s EUR 500
million convertible bond.
Based on the authorization granted by the Annual General Meeting on May 12, 2016,
adidas AG repurchased a total of 2,128,200 shares for a total price of EUR
299,999,851 (excluding incidental purchasing costs), i.e. for an average price of EUR
140.96 per share, in a third tranche between November 8, 2016 and January 31, 2017
inclusive. This corresponded to a notional amount of EUR 2,128,200 in the nominal
capital and consequently to 1.02% of the nominal capital. The repurchased shares
were either canceled, thus reducing the nominal capital, or used to meet obligations
arising from the potential conversion of adidas AG’s EUR 500 million convertible
bond and other admissible purposes under the authorization granted by the Annual
General Meeting on May 12, 2016. The share buyback program expired on December
31, 2017.
In the 2017 financial year, a total of 2,814,470 treasury shares were used to meet
obligations arising from the conversion of adidas AG’s convertible bond. In the 2018
financial year and up to and including February 23, 2018, a total of 9,861 treasury
shares were used to meet obligations arising from the conversion of adidas AG’s
convertible bond.
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Moreover, in the 2017 financial year, 30,420 treasury shares and in the period beyond
up to and including February 23, 2018, another 22,360 treasury shares were used as
consideration, inter alia for the transfer or licensing of intellectual property rights
and intangible property rights due to contractual obligations.
In the 2017 financial year and up to and including February 23, 2018, adidas AG used
a total of 2,877,111 treasury shares.
Employee stock purchase plan

In the 2016 financial year, adidas AG introduced an employee stock purchase plan in
favor of employees of adidas AG and its affiliated companies. On January 6, 2017,
adidas AG purchased 25,699 adidas AG shares at an average price of EUR 144.41 in
connection with the employee stock purchase plan. This corresponded to a total price
of EUR 3,711,236 (excluding incidental purchasing costs) with a pro rata amount or
an amount in the nominal capital of EUR 25,699 or 0.01%. All shares purchased for
this purpose on January 6, 2017 were issued to eligible employees on January 9,
2017 and on January 10, 2017. On April 7, 2017, adidas AG purchased 20,086 adidas
AG shares at an average price of EUR 176.16 in connection with the employee stock
purchase plan. This corresponded to a total price of EUR 3,538,364 (excluding
incidental purchasing costs) with a pro rata amount or an amount in the nominal
capital of EUR 20,086 or 0.009%. All shares purchased for this purpose on April 7,
2017 were issued to eligible employees on April 11, 2017. On July 7, 2017, adidas AG
purchased 22,563 adidas AG shares at an average price of EUR 175.61 in connection
with the employee stock purchase plan. This corresponded to a total price of
EUR 3,962,498 (excluding incidental purchasing costs) with a pro rata amount or an
amount in the nominal capital of EUR 22,563 or 0.01%. All shares purchased for this
purpose on July 7, 2017 were issued to eligible employees on July 11, 2017. On
October 9, 2017, adidas AG purchased 20,454 adidas AG shares at an average price of
EUR 194.40 in connection with the employee stock purchase plan. This corresponded
to a total price of EUR 3,976,337 (excluding incidental purchasing costs) with a pro
rata amount or an amount in the nominal capital of EUR 20,454 or 0.009%. All shares
purchased for this purpose on October 9, 2017 were issued to eligible employees on
22
October 11, 2017. On January 8, 2018, adidas AG purchased 25,672 adidas AG shares
at an average price of EUR 173.27 in connection with the employee stock purchase
plan. This corresponded to a total price of EUR 4,448,258 (excluding incidental
purchasing costs) with a pro rata amount or an amount in the nominal capital of EUR
25,672 or 0.01%. At the same time, adidas AG purchased another 3,642 adidas AG
shares at an average price of EUR 173.27, which were used as matching shares. This
corresponded to a total price of EUR 631,059 (excluding incidental purchasing costs)
with a pro rata amount or an amount in the nominal capital of EUR 3,642 or 0.002%.
All shares purchased for this purpose on January 8, 2018 were issued to eligible
employees on January 10, 2018.
Changes in the percentage of voting rights

Pursuant to § 160 section 1 no. 8 AktG, existing shareholdings which have been
notified to adidas AG in accordance with § 33 section 1 or section 2 (and until
December 31, 2017: § 21 section 1 or section 1a of the German Securities Trading Act
(Wertpapierhandelsgesetz – WpHG) need to be disclosed.
The following table reflects reportable shareholdings in adidas AG, Herzogenaurach,
as at the balance sheet date and up to and including February 23, 2018 which have
each been notified to adidas AG in written form. The respective details are taken from
the most recent voting rights notification received by adidas AG. All voting rights
notifications disclosed by adidas AG in the year under review and up to and including
February 23, 2018 are available on the adidas website / WWW.ADIDAS-
GROUP.COM/S/VOTING-RIGHTS-NOTIFICATIONS. The details on the percentage of
shareholdings and voting rights may no longer be up to date.
23
Notified reportable shareholdings as at February 23, 2018
Notifying party Date of reaching, Reporting AttributionsNotificati Sharehol Number of

exceeding or falling threshold on obligations and dings in voting rights
below %
attributions in
accordance with
WpHG1)
Albert Frère2) December 28, 2017 Exceeding § 33 7.50 15,694,711

5%
Fidelity Mt. Vernon December 13, 2017 Falling § 21 2.99 6,258,487

Street Trust, below 3%
Boston, MA, USA3)
adidas AG, November 28, 2017 Falling 2.618 5,478,213

Herzogenaurach, below 3%
Germany4)
BlackRock, Inc., November 14, 2017 Exceeding §§ 22, 25 sec. 1 7.38 15,448,941
Wilmington, DE, 5% no. 1 and
USA5) § 25 section 1 no. 2
Elian Corporate December 16, 2016 Exceeding § 22, 25 sec. 1 no. 2 5.71 11,950,482
Trustee (Cayman) 5%
Limited, Grand
Cayman, Cayman
Islands6)
FMR LLC, May 12, 2016 Exceeding § 22 5.31 11,117,704

Wilmington, DE, 5%
USA7)
Capital Research July 22, 2015 Exceeding § 22 sec. 1 sent. 1 3.02 6,325,110
and Management 3% no. 6
Company, Los
Angeles, CA, USA8)
The Capital Group July 22, 2015 Exceeding § 22 sec. 1 sent. 1 3.02 6,325,110
Companies, Inc., 3% no. 6 in conjunction
Los Angeles, CA, with § 22 sec. 1
USA 9) sent. 2 and 3
24
1) The provisions of the WpHG stated refer to the version applicable at the time of publication of the respective individual voting
rights notification. Until December 31, 2017, the notification obligations and attributions were regulated in §§ 21 et seq. WpHG
and have been regulated in §§ 33 et seq. since January 1, 2018.
2) See adidas AG’s disclosure dated February 8, 2018.
3) See adidas AG’s disclosure dated December 20, 2017.
5) See adidas AG’s disclosure dated November 20, 2017.
7) See adidas AG’s disclosure dated May 19, 2016.
8) See adidas AG’s disclosure dated July 29, 2015.
9) See adidas AG’s disclosure dated July 28, 2015.
10. Retained earnings
Retained earnings
EUR thousand
Retained earnings as of December 31, 2016 628,908
Distribution of a dividend of EUR 2.00 per ordinary share in the share capital for the 2016 fiscal year
(209,216,186 shares) 405,048
Allocation to other revenue reserves 200,000
Retained earnings brought forward 23,860
Net income of adidas AG for the 2017 fiscal year 549,454
Retained earnings as of December 31, 2017 573,314
11. Special reserve
The special reserve established in 2003 in accordance with § 273 HGB (old version)
and Section 35 Income Tax Regulations (Einkommensteuer-Richtlinien, “EStR”) for
write-downs relating to the construction of the factory outlet was reduced as
scheduled during the year under review by a EUR 322 thousand amortization charge.
25
12. Provisions/accruals
Provisions/accruals
EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Provisions for pensions and similar obligations 166,178 163,954
Provisions for taxes 19,828 21,944
Other provisions 438,037 339,307
Provisions/accruals 624,043 525,205
In the provisions for pensions and similar obligations, plan assets were offset against
obligations in accordance with § 246 [2] sentence 2 HGB. This related to plan assets
of the pension trust association “adidas Pension Trust e.V.”. The settlement amount
of the pension obligations totaled EUR 265,595 thousand as at December 31, 2017
(prior year: EUR 232,147 thousand). The plan assets were measured at fair value in
accordance with § 253 [1] sentence 3 HGB. As at the balance sheet date, the fair
value of the netted assets is EUR 99,417 thousand (prior year: EUR 68,194 thousand)
and historical costs amount to EUR 95,300 thousand (prior year: EUR 65,000
thousand).
Interest expenses from the pensions valuation in an amount of EUR 9,273 thousand
have been offset against the interest income from the adidas Pension Trust e.V. of
EUR 923 thousand.
The pension obligations to seven former members of the Executive Board, or their
former family members, who retired after December 31, 2005, are covered by a
pension fund in combination with a reinsured pension trust fund. This results in
indirect obligations for adidas AG to former Board members in the amount of
EUR 31,223 thousand (prior year: EUR 30,254 thousand for the related group of
people) for which no provisions have been recognized due to their funding through
the pension fund and pension trust fund. As at the balance sheet date, there are no
shortfalls for the indirect obligations.
However, pension provisions have been established for the pension entitlements of
six active members of the Executive Board, which amount to EUR 4,616 thousand
26
before offsetting (prior year: EUR 2,385 thousand for three Board members). The
provisions for the former members of the Executive Board and their survivors totaled
EUR 68,725 thousand before offsetting as at December 31, 2017 (prior year: EUR
48,372 thousand). These amounts also include the aforementioned indirect
obligations.
The difference between the application of the average market interest rate for the
past seven fiscal years and the application of the average market interest rate for the
past ten fiscal years amounts to EUR 39,118 thousand. Pursuant to § 253 (6)
sentence 2 HGB, this amount is subject to a restriction on distribution.
The largest item in other provisions concerns provisions for personnel of
EUR 224,757 thousand (prior year: EUR 161,405 thousand). This amount is primarily
attributable to provisions for performance-based remuneration components.
Additional significant items in other provisions are provisions for marketing of EUR
77,314 thousand (prior year: EUR 57,279 thousand) and provisions for outstanding
invoices of EUR 69,967 thousand (prior year: EUR 46,211 thousand). There are also
provisions for forward contracts in an amount of EUR 24,417 thousand (prior year:
EUR 38,380 thousand). These are recorded for unrealized losses from derivative
futures as well as on hedge accounting.
The fair value measurement of assets for the settlement of obligations for pensions
results in a total amount of EUR 4,117 thousand (prior year: EUR 3,194 thousand)
subject to restriction on distribution within the meaning of § 268 [8] HGB prior to
offsetting with the freely distributable reserves as at December 31, 2017.
27
13. Liabilities
Liabilities
EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Residual Residual Residual

term up to term 1-5 term more Prior year
Total 1 year years than 5 years total
Bonds 1,030,600 0 630,600 400,000 1,259,000
(previous year) (0) (859,600) (400,000)
of which convertible 30,600
Liabilities to banks 462 462 0 0 0
(previous year) (0) (0) (0)
Trade accounts payable 151,804 144,999 6,805 0 129,657
(previous year) (128,294) (1,363) (0)
Liabilities to affiliated companies 4,271,111 3,821,111 450,000 0 3,574,412
(previous year) (3,124,412) (450,000) (0)
Other liabilities 76,619 74,160 2,459 0 114,505
(previous year) (114,411) (93) (0)
of which from taxes 4,508 11,229
of which relating to social security 2,554 2,382
Dec. 31, 2017 5,530,596 4,040,732 1,089,864 400,000 5,078,174
Dec. 31, 2016 (3,367,117) (1,311,056) (400,000)
The liabilities are unsecured.

The liabilities to affiliated companies primarily relate to liabilities from Group
Treasury activities. Trade payables to affiliated companies amount to EUR 95,343
thousand (prior year: EUR 33,697 thousand).
Other liabilities include tax and customs liabilities, liabilities relating to social
security and similar obligations, accrued interest not yet payable, credit balances in
accounts receivable, option premiums paid by subsidiaries, and salaries and
commissions payable.
The convertible bond has a maximum maturity including prolongation option until
2019 and was originally divided into 2,500 bearer bonds with equal rights, each in the
nominal amount of EUR 200 thousand. The bondholder has the right to convert each
28
bond in full, but not partially, into registered common shares (no-par-value shares)
during an exercise period. There is also the right to early settlement in 2017 in
compliance with a notice period, which may not be exercised if adidas AG has
exercised the right to early settlement.
In the fiscal year 2017, bondholders exercised their right to convert bonds. The
remaining liability relating to the convertible bond amounts to EUR 30,600 thousand
as at December 31, 2017.
In 2014, adidas AG issued bonds with a total value of EUR 1,000,000 thousand. The
EUR 600,000 thousand Eurobond matures in 2021; the EUR 400,000 thousand
Eurobond matures in 2026. Both bonds are listed on the Luxembourg securities
exchange in denominations of EUR 1 thousand each.
14. Contingent liabilities and other financial commitments
Contingent liabilities
EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Warranty obligations 615,591 810,530
of which for affiliated companies
- Bank loans 87,944 129,752
- Letters of credit 65,852 63,908
- Guarantee agreements 461,795 616,870
The guarantee obligations for bank loans to affiliated companies are from lines of
credit drawn on by affiliated companies. adidas AG’s letters of credit are mainly
import letters of credit in connection with product purchases in the Far East. The
guarantee agreements are with various subsidiaries and secure mainly rent
contracts.
Other liabilities relate to absolute guarantees of adidas AG for the benefit of affiliated
companies. Comfort letters in unlimited amounts for the benefit of seven (prior year:
nine) affiliated companies were issued as at December 31, 2017. The risk of these
being utilized is deemed to be low.
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adidas AG declares support, except in the case of political risk, for 94 affiliated
companies, that they are able to meet their contractual liabilities. This declaration
replaces the declaration dated February 17, 2017, which is no longer valid. The
declaration of support automatically ceases from the time that a company no longer
is a subsidiary of adidas AG.
Since the liabilities assumed arise in the normal course of business and due to the
adidas Group’s current strong financial position, the risk that these will be called on
is considered extremely slight.
Other financial commitments

Other financial commitments of EUR 2,109,982 thousand (prior year: EUR 2,301,868
thousand) for adidas AG include amounts for the entire foreseeable contractual
period for promotion, advertising, rental and leasing agreements as at December 31,
2017.
Maturities
EUR thousand
in 2018 413,317
2019-2022 848,893
after 2022 847,772
2,109,982
The contracted other financial commitments provide adidas AG with planning

certainty on the one hand and, on the other hand, they ensure that the Company has
the necessary liquidity. The risk of making payments that are not covered by the
relevant contracts is considered to be very low.
The adidas Group purchases more than 80% of its products in Asia. Since a major
portion of the product costs concerns raw materials that the suppliers have to
purchase in US dollars (USD), billings to the adidas Group are also made mainly in
USD. In contrast, sales by Group companies to customers are mainly in euros (EUR),
pounds sterling (GBP), Japanese yen (JPY), and in many other currencies. Currency
hedges are entered into to reduce the risk of changes in fair value and in cash flows
30
(currency risks). Most subsidiaries hedge their currency risks through adidas AG,
except for those subsidiaries that are unable to hedge through adidas AG due to local
currency restrictions, or for whom it is more sensible to hedge locally for economic
reasons. Currency risks that are assumed by adidas AG from subsidiaries by entering
into inter-Group currency transactions are strategically hedged with banks for a
period of up to 24 months in advance using forward exchange transactions, currency
swaps, currency options, or a combination of currency options, which provide
protection and, at the same time, the opportunity to profit from future beneficial
foreign exchange rate movements on financial markets. In 2017, the adidas Group
purchased around USD 3.8 billion net to hedge its operating business.
Due to procurement of the majority of goods in the Far East and the adidas Group’s
global operations, the worldwide distribution of goods in an important component of
the Group’s business. At the current time – due to continuing low commodity prices –
no hedging of commodity futures takes place. This strategy is reviewed regularly.
Outstanding financial derivatives

EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Notional amounts
Currency hedging contracts 16,861,372 16,460,185
Equity instrument 58,001 0
16,919,373 16,460,185
The notional volume of option structures is included only once in the notional
amounts.
The equity derivative serves to hedge a Long-Term Incentive Plan (LTIP), a share-
based remuneration scheme with cash settlement. The company uses derivative
instruments to hedge against the risk of share price fluctuations. The fair value is
based on the market price of the adidas AG share as at December 31, 2017,
multiplied by the notional volume less accrued interest.
31
Outstanding financial derivatives

EUR thousand
Dec. 31, 2017 Dec. 31, 2016
Carrying amount Fair value Carrying amount Fair value
Assets (Other assets)
Currency hedging contracts 0 315,703 0 368,043
Liabilities (Provision for contingent losses)
Currency hedging contracts -21,702 -318,966 -38,380 -394,548
Equity instrument -2,716 -4,463
-24,418 -7,726 -38,380 -26,505
Notional amounts represent the gross total of all call and put contracts for derivative
financial transactions. Fair values of forward exchange transactions are determined
based on current ECB reference exchange rates or reference exchange rates of local
central banks, together with forward premiums or discounts. The fair values (gains
and losses) of the currency hedging contracts are presented as gross values.
Currency options are measured using market quotes or option pricing models
(Garman-Kohlhagen model).
The notional amounts of outstanding financial derivatives in foreign currency are
translated into euros at year-end closing rates.
The carrying values are taken from the balance sheet.
The table below provides an overview of the risks hedged. The underlying
transactions within a portfolio are secured with one or more hedging instruments
(portfolio hedge):
32
Hedged risk as of the balance sheet date

EUR thousand / Maturity
Net change in
Notional fair value Maturity
Currency risk
Risk
Forward exchange transactions and options with subsidiaries 7,162,407 118,691 1 - 20 months
Hedging
Forward exchange transactions and options with banks 7,077,110 -120,010 1 - 20 months
Risk
Equity instrument with subsidiaries 22,987 1,748 25 month
Hedging
Equity instrument with banks 22,987 -1,748 25 month
The difference in the notional amount relates to internal forward exchange

transactions without an external hedge. The foreign currency requirement of one
subsidiary is covered with the excess of the same foreign currency of another
subsidiary (natural hedge).
15. Sales
adidas AG’s business activities are primarily concentrated in one sector, specifically
the development, trading and marketing of sports and leisure articles. In addition,
adidas AG generates a substantial portion of its revenues from licensing income,
primarily from affiliated companies.
33
Sales
EUR thousand
2017
2016
Breakdown by product group
Shoes 845,504 694,540
Textiles 383,648 391,807
Sports equipment 71,844 78,430
1,300,977 1,164,777
Other sales revenues 622,507 543,509
Licensing income 1,808,802 1,580,489
Sales 3,732,306 3,288,775
Of these revenues, EUR 1,822,166 thousand (prior year: EUR 1,612,687 thousand) was
generated in Germany and EUR 1,910,140 thousand (prior year:
EUR 1,676,088 thousand) outside Germany, mainly in Europe.
16. Other operating income
Other operating income consists mainly of EUR 431,538 thousand in foreign currency
gains (prior year: EUR 343,070 thousand).
Other operating income includes income relating to other periods of
EUR 41,176 thousand (prior year: EUR 94,705 thousand). This income includes
essentially income from the reversal of provisions in an amount of EUR 26,710
thousand (prior year: EUR 28,750 thousand).
34
17. Cost of materials
Cost of materials
EUR thousand
2017 2016
Cost of raw materials, consumables and supplies, and of 907,322 786,396

purchased merchandise
Cost of purchased services 385,160 340,983
Cost of materials 1,292,482 1,127,379
18. Personnel expenses
Personnel expenses
EUR thousand
2017 2016
Wages and salaries 580,819 503,671
Social security, post-employment and other employee benefit 111,245 84,221

costs
of which for old-age pensions 33,153 20,103
Personnel expenses 692,064 587,891
The increase in personnel expenses was due to higher employee headcounts and
higher salaries than in the prior year due to salary increases.
19. Amortization and write-downs of intangible fixed assets and

depreciation and write-downs of tangible fixed assets
Amortization and write-downs of intangible assets of EUR 44,845 thousand (prior

year: EUR 56,608 thousand) relates to trademark rights as well as to computer
software and licenses. Depreciation and write-downs of tangible fixed assets of
EUR 45,710 thousand (prior year: EUR 43,801 thousand) relates primarily to write-
downs of EUR 14,261 thousand (prior year: EUR 14,861 thousand) on buildings, write-
35
downs of EUR 11,231 thousand (prior year: EUR 12,341 thousand) on operating and
office equipment and write-downs on computer hardware of EUR 7,024 thousand
(prior year: EUR 6,441 thousand).
20. Other operating expenses
Other operating expenses essentially comprise cost transfers, currency exchange

losses, advertising and promotional expenses, legal and consultancy fees, services,
travel expenses, rental and lease charges, postal and telephone expenses, and
outgoing freight. The EUR 366,269 thousand increase in these expenses essentially
results from the increase in advertising and promotional expenses by EUR 132,134
thousand to EUR 490,313 thousand, the allowance for doubtful accounts relating to
receivables by EUR 79,002 thousand to EUR 87,574 thousand, currency exchange
losses by EUR 70,272 thousand to EUR 457,028 thousand and increased expenses for
legal and consultancy fees by EUR 53,530 thousand to EUR 268,114 thousand. Other
operating expenses include expenses not relating to the accounting period in an
amount of EUR 21,035 thousand (prior year: EUR 20,186 thousand). Thereof, EUR
10,080 thousand (prior year: EUR 14,335 thousand) relates to a provision for risks,
EUR 9,831 thousand (prior year: 4,742 thousand) relates to the disposal of fixed
assets and EUR 1,124 thousand (prior year EUR 1,109 thousand) relates to
obligations to reverse constructional changes to office buildings, plants and retail
stores.
21. Income from investments in related companies
Income from adidas AG’s investments in related companies amounted to

EUR 155,420 thousand (prior year: EUR 624,546 thousand) and essentially relates to
dividend payments from subsidiaries in Korea, Thailand, New Zealand and Poland.
36
22. Profits received/losses absorbed in accordance with a profit and

loss transfer agreement
A profit and loss transfer agreement exists with adidas Insurance & Risk Consultants
GmbH, Herzogenaurach, adidas Beteiligungsgesellschaft mbH, Herzogenaurach and
with adidas anticipation GmbH, Herzogenaurach. The significant change is
attributable to the transfer of a gain from adidas Beteiligungsgesellschaft mbH
amounting to EUR 500,426 thousand (prior year: loss of EUR 4,418 thousand).
23. Write-downs of long-term financial assets
No equity investments or loans to affiliated companies were written down in 2017.
24. Interest result
Interest result
EUR thousand
2017 2016
Income from loans of long-term financial assets 0 0
of which from affiliated companies 0 0
Other interest and similar income 40,622 25,937
of which from affiliated companies 39,313 25,100
Interest and similar expenses -40,376 -47,281
of which to affiliated companies -6,594 -7,644
Interest result 247 -21,344
Interest and similar expenses includes EUR 8,429 thousand (prior year:
EUR 7,520 thousand) from the compounding of provisions, of which EUR
8,360 thousand (prior year: EUR 7,377 thousand) relates to the interest expense in
connection with pension provisions.
37
25. Taxes on income
Taxes on income mainly include municipal trade tax and withholding tax on interest
and licensing income resulting from the collection of licensing fees outside Germany.
Taxes on income does not include any gains or losses from deferred taxes. Overall,
deferred tax liabilities were more than offset by deferred tax assets. In accordance
with the option under § 274 (1) sentence 2 HGB, the Company has opted to forgo
recognizing the surplus deferred tax assets.
As at December 31, 2017, adidas AG expects to realize a total of EUR 32,559 thousand
in future tax benefits due to temporary accounting differences (prior year:
EUR 31,571 thousand). This amount was calculated based on a combined income tax
rate of 28%.
Deferred tax assets result primarily from other assets, intangible assets and forward
exchange transactions. Deferred tax liabilities result essentially in relation to land,
shares in affiliated companies and pension provisions.
26. Remuneration of the Executive Board and the Supervisory Board
Executive Board
Total remuneration of members of the Executive Board in the 2017 fiscal year was
EUR 33,113 thousand (prior year: EUR 11,333 thousand). Due to the high
Performance Bonus paid for the successful financial year and the payout in
connection with the LTIP 2015/2017 as well as the increase in the number of
Executive Board members, the appointment of Harm Ohlmeyer as member of the
Executive Board and successor to Robin J. Stalker with effect from March 7, 2017
and the appointment of Gil Steyaert as member of the Executive Board and successor
to Glenn Bennett with effect from May 12, 2017 and the appointment of Karen Parkin
as a member of the Executive Board as well with effect from May 12, 2017, the total
compensation for the year under review is higher than the total compensation for the
2016 financial year.
38
Pension commitments
EUR thousand
Service cost Accumulated pension obligation for
the pension commitments
excluding deferred compensation
2017 2016
2017 2016
Executive Board members incumbent as at Dec. 31, 2017
Kasper Rorsted 1) 1,068 533 1,360 533
Roland Auschel 307 317 1,263 925
Eric Liedtke 324 328 1,160 927
Harm Ohlmeyer 1) 322 0 322 0
Karen Parkin 2) 248 0 248 0
Gil Steyaert 3) 263 0 263 0
Total 2,532 1,178 4,616 2,385
Executive Board members who retired in 2017 2017 2016 2017 2016
Glenn Bennett 4) 350 380 0 4,287
Robin J. Stalker 5) 332 483 0 4,106
Total 682 863 0 9,617

1) Executive Board member with effect from March 7, 2017, appointment as Chief Financial Officer from the end of the Annual
General Meeting of adidas AG on May 11, 2017.
2) Member of the Executive Board, responsible for the Executive Board function Human Resources, with effect from May 12,
2017.
3) Member of the Executive Board with effect from May 12, 2017, responsible for the Executive Board function Global Operations
with effect from August 5, 2017.
4) Member of the Executive Board until the end of August 4, 2017.
5) Member of the Executive Board until the end of the Annual General Meeting of adidas AG on May 11, 2017.
Further information is contained in the compensation report in the combined

management report.
Former members of the Executive Board and their survivors or their former family
members received a total of EUR 13,502 thousand in benefits in the 2017 fiscal year
(prior year: EUR 8,953 thousand). The total remuneration for the 2017 fiscal year (of
which company pensions of approx. EUR 3,675 thousand) includes, inter alia, the
bonus to Herbert Hainer under the LTIP 2015/2017 in the amount of EUR 5,082
thousand, the compensation for Robin J. Stalker in the amount of EUR 590 thousand
for the period from May 12, 2017 to March 31, 2018 and for Glenn Bennett in the
amount of EUR 465 thousand for the period from August 5, 2017 to March 31, 2018,
39
the compensation for the post-contractual competition prohibition payable for a

period of 24 months following the termination of contract for Robin J. Stalker in the
total amount of EUR 666 thousand and for Glenn Bennett in the total amount of EUR
709 thousand as well as the follow-up bonus for Robin J. Stalker in the amount of
EUR 740 thousand and for Glenn Bennett in the amount of EUR 693 thousand.
Provisions for pension entitlements for the former members of the Executive Board
who resigned on or before December 31, 2005 and their surviving dependents or
former family members were created, in an amount of EUR 37,501 thousand in total
as at December 31, 2017 before netting with the assets of the “adidas Pension Trust
e.V.” (prior year: EUR 36,331 thousand).
There are pension commitments towards six former Executive Board members or
their former family members who resigned after December 31, 2005, which are
covered by a pension fund or a pension fund in combination with a reinsured pension
trust fund. From this, indirect obligations amounting to EUR 31,223 thousand (prior
year: EUR 21,861 thousand) arise for adidas AG, for which no accruals were
established due to financing through the pension fund and pension trust fund. This
increase is attributable to the resignation of Robin Stalker and Glenn Bennett.
The Executive Board members have not received any loans and advance payments
from adidas AG; due to his departure from the Executive Board, prepayments were
made to Robin J. Stalker with regard to the 2017 Performance Bonus and prorated
for 2018 as well as with regard to the LTIP 2015/2017.
Supervisory Board
The annual total compensation for members of the Supervisory Board in accordance
with the Articles of Association was EUR 1,902 thousand (prior year: EUR 1,327
thousand). This includes attendance fees in a total amount of EUR 127 thousand
(prior year EUR 71 thousand). The increase in the total compensation for the 2017
financial year compared to the 2016 financial year is attributable, in particular, to the
fact that the Annual General Meeting on May 11, 2017 approved the amendment to
40
the Articles of Association regarding the adjustment of the Supervisory Board

compensation with effect from July 1, 2017. Furthermore, as a result of the
enlargement of the Supervisory Board by four members resolved upon by the Annual
General Meeting on May 12, 2016, 2017 was the first financial year in which the
Supervisory Board was consistently composed of 16 members.
The Supervisory Board members have not received any loans or advance payments
from adidas AG.
27. Other disclosures
No. of employees (annual average)

2017 2016
Total Salaried Wage Total Salaried Wage
Global Sales 547 547 0 479 479 0
Headquarters
Corporate Services 2,040 1,930 110 1,810 1,689 121
Marketing 1,736 1,736 0 1,528 1,526 2
Operations 1,932 1,009 923 1,765 920 845
Market Central 943 842 101 910 844 66
7,198 6,492
As of December 31 7,555 6,788

41
Recommendation on the appropriation of the retained earnings of adidas AG

The Executive Board of adidas AG will propose to use retained earnings of adidas AG
in an amount of EUR 573,314 thousand as reported in the 2017 financial statements
of adidas AG for a dividend payment of EUR 2.60 per dividend-entitled share. The
subsequent remaining amount will be carried forward.
Declaration on the German Corporate Governance Code

In February 2018, the Executive Board and Supervisory Board of adidas AG issued an
updated Declaration of Compliance in accordance with § 161 AktG and made it
permanently available to the shareholders. The full text of the Declaration of
Compliance is available on the Company’s corporate website.
Disclosures pursuant to § 285 no. 10 HGB

The disclosures pursuant to § 285 no. 10 HGB are contained in Appendix 2 to the
notes to the financial statements.

Expenses for the audit fees of KPMG AG Wirtschaftsprüfungsgesellschaft were
mainly related to the audits of both the consolidated financial statements and the
financial statements of adidas AG, as well as the audit of the financial statements of
its subsidiary, adidas CDC Immobilieninvest GmbH. Integrated IT project audits were
also conducted.
Other confirmation services comprise audits which are either required by law or
contractually agreed, such as European Market Infrastructure Regulation (EMIR)
audits according to § 20 WpHG, audits according to the German Packaging Ordinance
(Verpackungsverordnung – VerpackV), audits of the utilization of funds, and other
contractually agreed-upon confirmation services.
The tax consultancy services include support services for transfer pricing and
consulting for sales taxes on a case-by-case basis.
Other services provided by the auditor comprise supporting services to ensure the
quality of sales transactions, and legal consultancy services.
42
In accordance with § 285 no. 17 HGB, the Company has opted not to include a
disclosure of the total audit fee charged by the auditor in this report, since such
disclosures are already contained in the consolidated financial statements of the
adidas Group.

There have been no events of particular significance since the end of the fiscal year.
In its function as the ultimate parent, adidas AG, Herzogenaurach (Local Court of
Fürth, HRB 3868), prepares consolidated financial statements, which are published
in the electronic Federal Gazette.
Herzogenaurach, February 23, 2018 The Executive Board of adidas AG

43
adidas AG
Statement of changes in fixed assets in 2017
Aquisition and production costs
Amounts in EUR (thousand (HGB) 01.01.2017 Additions Disposals Reclassifications 31.12.2017
I. Intangible Assets
1. Purchased concessions, trademarks and similar rights

and licences to such rights 504.222 42.655 -11.118 35.508 571.267
2. Prepayments and assets under construction 45.938 17.835 -7 -35.508 28.258
550.160 60.490 -11.125 0 599.525
II. Tangible assets
1. Land, land rights and buildings 480.009 10.521 -2.859 3.196 490.867
2. Technical equipment and machinery 46.490 9.997 -1.576 673 55.584
3. Other equipment, operating and office equipment 275.579 30.585 -278 3.148 309.034
4. Prepayments and assets under construction 75.127 115.966 -30 -7.017 184.046
877.205 167.069 -4.743 0 1.039.531
III. Financial Assets
1. Shares in affiliated companies 4.146.580 12.499 -12.256 0 4.146.823
2. Loans to affiliated companies 0 40.000 0 0 40.000
3. Equity investments 79.249 0 0 0 79.249
4. Loans to non-affiliated companies 200 0 0 0 200
5. Other loans 0 62.453 0 0 62.453
4.226.029 114.952 -12.256 0 4.328.725
Fixed Assets 5.653.394 342.511 -28.124 0 5.967.781

44
Accumulated depreciation Book values
01.01.2017 Additions Disposals Write-up Reclassifications 31.12.2017 31.12.2017 31.12.2016
437.986 44.845 -7.161 0 0 475.670 95.597 66.236
0 0 0 0 0 0 28.258 45.938
437.986 44.845 -7.161 0 0 475.670 123.855 112.174
133.327 14.261 -153 0 0 147.435 343.432 346.682
28.130 5.293 -620 0 0 32.803 22.781 18.360
223.104 26.156 -204 0 0 249.056 59.978 52.475
0 0 0 0 0 0 184.046 75.127
384.561 45.710 -977 0 0 429.294 610.237 492.644
20.590 0 0 0 0 20.590 4.126.233 4.125.990
0 0 0 0 0 0 40.000 0
0 0 0 0 0 0 79.249 79.249
0 0 0 0 0 0 200 200
0 0 0 0 0 0 62.453 0
20.590 0 0 0 0 20.590 4.308.135 4.205.439
843.137 90.555 -8.138 0 0 925.554 5.042.227 4.810.257

45
Supervisory Board
Igor Landau
Chairman
residing in Lugano, Switzerland
Pensioner
Membership in control bodies pursuant to § 285 sec. 10 HGB:
- none
Sabine Bauer*
Deputy Chairwoman
residing in Erlangen, Germany
Full-time member of the Works Council Herzogenaurach, adidas AG
Chairwoman of the Central Works Council, adidas AG
Chairwoman of the European Works Council, adidas AG
- none
Willi Schwerdtle
Deputy Chairman
residing in Munich, Germany
Independent Management Consultant as well as Partner, WP Force Solutions GmbH, Bad
Homburg v.d. Höhe, Germany

Member of the Supervisory Board, Eckes AG, Nieder-Olm, Germany

Chairman of the Supervisory Board, Windeln.de AG, Munich, Germany
46
Ian Gallienne
residing in Gerpinnes, Belgium
Co-Chief Executive Officer, Groupe Bruxelles Lambert, Brussels, Belgium
 Member of the Board of Directors, Pernod Ricard SA, Paris, France

 Member of the Board of Directors, SGS SA, Geneva, Switzerland
 Member of the Board of Directors, Umicore SA, Brussels, Belgium1)
 Member of the Board of Directors, Erbe SA, Loverval, Belgium
Mandates within the Groupe Bruxelles Lambert:

 Member of the Board of Directors, Imerys SA, Paris, France
 Member of the Board of Directors, Sienna Capital S.à r.l., Strassen, Luxembourg
 Member of the Board of Directors, GBL Energy S.à r.l., Strassen, Luxembourg2)
 Member of the Board of Directors, GBL Verwaltung SA, Strassen, Luxembourg3)
Dieter Hauenstein*
residing in Herzogenaurach, Germany
- none
Dr. Wolfgang Jäger*

residing in Bochum, Germany
Research Fellow at the Institute for Social Movements at the Ruhr Universität Bochum, Expert
Commission “Cultures of remembrance of social democracy” of Hans-Böckler-Stiftung,
Bochum, Germany 4)
- none
47
Dr. Stefan Jentzsch

residing in New York, USA
Corporate Finance Consultant/Partner, Perella Weinberg Partners LP, New York, USA
- Deputy Chairman of the Supervisory Board, AIL Leasing München AG, Grünwald,
Germany
Herbert Kauffmann
residing in Stuttgart, Germany
Independent Management Consultant, Stuttgart, Germany
- Member of the Supervisory Board, DEUTZ AG, Cologne, Germany
Katja Kraus
residing in Hamburg, Germany
Author/Managing Partner, Jung von Matt/sports GmbH, Hamburg, Germany
- none
Kathrin Menges
residing in Neuss, Germany
Executive Vice President Human Resources and Infrastructure Services, Henkel AG & Co. KGaA,
Düsseldorf, Germany
- none
Mandates within the Henkel Group:

- Member of the Supervisory Board, Henkel Central Eastern Europe GmbH, Vienna,
Austria
- Member of the Supervisory Board, Henkel Nederland B.V., Nieuwegein, The Netherlands
- Member of the Board of Directors, Henkel Norden AB, Stockholm, Sweden
- Member of the Board of Directors, Henkel Norden Oy, Vantaa, Finland
48
Udo Müller*
Director Future Communication, adidas AG
- none
Roland Nosko*
residing in Wolnzach, Germany
Trade Union Official, IG BCE, Headquarters Nuremberg, Nuremberg, Germany
- Deputy Chairman of the Supervisory Board, CeramTec GmbH, Plochingen, Germany

- Member of the Supervisory Board, Plastic Omnium Automotive Exteriors GmbH, Munich,
Germany5)
Hans Ruprecht*
Vice President Customer Service Central Europe West, adidas AG
- none
Nassef Sawiris
residing in London, Great Britain
Chief Executive Officer & Member of the Board of Directors, OCI N.V., Amsterdam,
The Netherlands
- Member of the Board of Directors, LafargeHolcim Ltd., Jona, Switzerland
Mandates within the OCI N.V. Group:

- Member of the Board of Directors, OCI Partners LP, Wilmington, Delaware, USA
49
Heidi Thaler-Veh*
residing in Uffenheim, Germany
Member of the Central Works Council, adidas AG
- none
Kurt Wittmann*
residing in Markt Bibart, Germany
First Deputy Chairman of the Works Council Herzogenaurach, adidas AG
- none
50
Executive Board
Kasper Rorsted, Pöcking, Germany

Chief Executive Officer
Membership in control bodies pursuant to § 285 para. 10 HGB:
- Member of the Supervisory Board, Bertelsmann SE & Co. KGaA, Gütersloh, Germany
- Member of the Supervisory Board, Danfoss A/S, Nordborg, Denmark1)
Roland Auschel, Erlangen, Germany

Executive Board member in charge of Global Sales
- none
Eric Liedtke, Erlangen, Germany

Executive Board member in charge of Global Brands
- Member of the Board of Directors, Carbon, Inc., Redwood City, USA2)
Harm Ohlmeyer3), Röttenbach, Germany

Chief Financial Officer
- none
Karen Parkin4), Portland, USA

Executive Board member in charge of Global Human Resources
- none
51
Gil Steyaert5), Wilmslow, Great Britain

Executive Board member in charge of Global Operations
- none
Executive Board member incumbent until the end of the Annual General Meeting on May 11,
2017:
Robin J. Stalker, Oberreichenbach, Germany

Chief Financial Officer
- Member of the Supervisory Board, Schaeffler AG, Herzogenaurach, Germany
Executive Board member incumbent until August 4, 2017:
Glenn Bennett, Boston/Massachusetts, USA

Executive Board member in charge of Global Operations
- none
52
Shareholdings of adidas AG, Herzogenaurach

at December 31, 2017
Equity Profit / Loss

Share in capital
Company and Domicile Currency (currency units in % (currency units
held by 1)
in thousands) in thousands)
Germany
1 adidas Insurance & Risk Consultants GmbH 2) Herzogenaurach (Germany) EUR 26 directly 100 -
2 adidas Beteiligungsgesellschaft mbH 2) Herzogenaurach (Germany) EUR 681.990 directly 100 -
3 adidas CDC Immobilieninvest GmbH Herzogenaurach (Germany) EUR 8.702 14 100 (2.839)
4 adidas Verwaltungsgesellschaft mbH 3) Herzogenaurach (Germany) EUR 4.303 76 100 (26)
5 adidas anticipation GmbH 2) Herzogenaurach (Germany) EUR 25 directly 100 -
Europe (incl. Middle East and Africa)

6 adidas sport gmbh Cham (Switzerland) CHF 6.721 directly 100 2.646
7 adidas Austria GmbH Klagenfurt (Austria) EUR 6.926 directly 95,89 1.471
6 4,11
8 runtastic GmbH Pasching (Austria) EUR 999 10 100 (3.693)
9 adidas France S.a.r.l. Landersheim (France) EUR 200.297 directly 100 12.148
10 adidas International B.V. Amsterdam (Netherlands) EUR 6.832.931 directly 94 361.715

9 6
11 adidas International Trading B.V. Amsterdam (Netherlands) EUR 1.626.127 10 100 760.490
12 adidas International Marketing B.V. Amsterdam (Netherlands) EUR 54.009 10 100 2.332
13 adidas International Finance B.V. Amsterdam (Netherlands) EUR 46.191 10 100 20.573
14 adidas International Property Holding B.V. Amsterdam (Netherlands) EUR 50.955 86 100 3.402
15 adidas Infrastructure Holding B.V. Amsterdam (Netherlands) EUR (23) 10 100 0
16 adidas Benelux B.V. Amsterdam (Netherlands) EUR 4.663 directly 100 2.890
17 Hydra Ventures B.V. Amsterdam (Netherlands) EUR (17.979) 10 100 (7.871)
18 adidas (UK) Limited Stockport (Great Britain) GBP 30.907 10 100 27.418
19 Reebok International Limited 5) London (Great Britain) EUR 340.383 76 100 (44.676)
20 Trafford Park DC Limited London (Great Britain) GBP 1.089 15 100 303
21 Reebok Pensions Management Limited 3) 5) London (Great Britain) GBP - 19 100 -
22 Reebok Europe Holdings London (Great Britain) GBP 26.493 19 100 245
23 Luta Limited 3) 5) London (Great Britain) GBP - 19 100 -
24 adidas (Ireland) Limited Dublin (Ireland) EUR 2.806 10 100 763
25 adidas International Re DAC Dublin (Ireland) EUR 21.872 10 100 2.696
26 Reebok Ireland Limited 3) Dublin (Ireland) EUR 56 24 100 -
27 Five Ten Europe NV 3) Lasne (Belgium) EUR (271) 78 100 (187)
28 adidas España S.A.U. Zaragoza (Spain) EUR 41.286 2 100 12.057
29 adidas Finance Spain S.A.U. Zaragoza (Spain) EUR 36.390 76 100 163
30 Global Merchandising, S.L. Madrid (Spain) EUR 8.022 10 100 3.760
31 adidas Italy S.p.A. Monza (Italy) EUR 55.813 10 100 9.707
32 adidas Portugal - Artigos de Desporto, S.A. Lisbon (Portugal) EUR 6.440 10 100 1.597
33 adidas Business Services Lda. Morea de Maia (Portugal) EUR 1.263 10 98 (149)
directly 2
34 adidas Norge AS Oslo (Norway) NOK 29.357 directly 100 10.099
35 adidas Sverige AB Solna (Sweden) SEK 45.222 directly 100 (10.580)
36 adidas Finance Sverige AB Solna (Sweden) SEK 272.188 76 100 702
37 adidas Suomi Oy Helsinki (Finland) EUR 1.620 10 100 502
38 adidas Danmark A/S Copenhagen (Denmark) DKK 20.635 10 100 7.530
39 adidas CR s.r.o. Prague (Czech Republic) CZK 148.054 directly 100 47.075
40 adidas Budapest Kft. Budapest (Hungary) HUF 462.671 directly 100 117.407
41 adidas Bulgaria EAD Sofia (Bulgaria) BGN 8.431 directly 100 3.026
42 LLC 'adidas, Ltd.' Moscow (Russia) RUB 26.357.060 7 100 (1.023.866)
43 adidas Poland Sp.z o.o. Warsaw (Poland) PLN 62.031 directly 100 28.606
44 adidas Finance Poland S.A. Warsaw (Poland) PLN 98.837 76 100 961
45 adidas Romania S.R.L. Bucharest (Romania) RON 24.762 10 100 13.113
46 adidas Baltics SIA Riga (Latvia) EUR 1.163 10 100 564
47 adidas Slovakia s.r.o. Bratislava (Slovak Republic) EUR 1.464 directly 100 913
48 adidas Trgovina d.o.o. Ljubljana (Slovenia) EUR 538 directly 100 274
49 SC 'adidas-Ukraine' Kiev (Ukraine) UAH 954.714 directly 100 261.987
50 adidas LLP Almaty (Republic of Kazakhstan) KZT 4.751.216 directly 100 846.856
51 adidas Serbia d.o.o. Belgrade (Serbia) RSD 532.183 10 100 123.062
52 adidas Croatia d.o.o. Zagreb (Croatia) HRK 39.998 10 100 5.083
53 adidas Hellas A.E. Athens (Greece) EUR 19.307 directly 100 1.908
54 adidas (Cyprus) Limited Nicosia (Cyprus) EUR 923 directly 100 322
55 adidas Spor Malzemeleri Satis ve Pazarlama A.S. Istanbul (Turkey) TRY 316.405 10 100 20.330
56 adidas Emerging Markets L.L.C Dubai (United Arab Emirates) USD 18.958 indirectly 51 280
9 49
57 adidas Emerging Markets FZE Dubai (United Arab Emirates) USD 119.681 10 100 57.578
58 adidas Levant Limited Dubai (United Arab Emirates) JOD 2.956 57 100 1
53


Share in capital
held by 1)
59 adidas Levant Limited - Jordan Amman (Jordan) JOD 1.720 58 100 840
60 adidas Imports & Exports Ltd. Cairo (Egypt) EGP (34.455) 61 100 (18.946)
61 adidas Sporting Goods Ltd. Cairo (Egypt) EGP 263.559 10 90 102.641

11 10
62 adidas Egypt Ltd. 3) Cairo (Egypt) USD (1.831) directly 100 -
63 Reebok Israel Ltd. Holon (Israel) ILS 15.839 directly 100 809
64 Life Sport Ltd. Holon (Israel) ILS 128.827 10 85 57.027
65 adidas Morocco LLC Casablanca (Morocco) MAD (57.870) directly 100 (73.026)
66 adidas (South Africa) (Pty) Ltd. Cape Town (South Africa) ZAR 320.376 directly 100 69.216
North America
67 adidas North America, Inc. Portland, Oregon (USA) USD 4.775.256 10 100 (392.769)
68 adidas America, Inc. Portland, Oregon (USA) USD 221.944 67 100 66.514
69 adidas International, Inc. Portland, Oregon (USA) USD 88.314 67 100 12.269
70 adidas Team, Inc. 3) Des Moines, Iowa (USA) USD (1.013) 67 100 -
71 The Reebok Worldwide Trading Company, LLC Wilmington, Delaware (USA) USD 17.918 76 100 823
72 Reebok Securities Holdings LLC 3) 4) Wilmington, Delaware (USA) USD - 76 100 -
73 Textronics, Inc. Wilmington, Delaware (USA) USD 12.389 69 100 402
74 Onfield Apparel Group, LLC 3) 6) Dover, Delaware (USA) USD - 76 99 -

75 1
75 Reebok Onfield, LLC 3) 6) Dover, Delaware (USA) USD - 76 100 -
76 Reebok International Ltd. 4) Canton, Massachusetts (USA) USD (1.263.280) 67 100 (192.184)
77 adidas Indy, LLC 6) (formerly: Sports Licensed Division of the adidas Group, LLC) Wilmington, Delaware (USA) USD 33.560 76 99 (42.918)
72 1
78 Stone Age Equipment, Inc. Redlands, California (USA) USD (512) 68 100 (11.518)
79 Spartanburg DC, Inc. Spartanburg, South Carolina (USA) USD 12.661 68 100 1.294
80 adidas Canada Ltd. Woodbridge, Ontario (Canada) CAD 122.500 10 100 16.329
Asia
81 adidas Sourcing Limited Hong Kong (China) USD 548.652 11 100 533.149
82 adidas Services Limited Hong Kong (China) USD 13.414 10 100 1.372
83 adidas Hong Kong Limited Hong Kong (China) HKD 380.686 2 100 292.747
84 Reebok Trading (Far East) Limited Hong Kong (China) USD 31.406 76 100 230
85 adidas (Suzhou) Co. Ltd. Suzhou (China) CNY 230.058 2 100 2.611
86 adidas Sports (China) Co. Ltd. Suzhou (China) CNY 9.647.843 2 100 4.006.245
87 adidas (China) Ltd. Shanghai (China) CNY 987.565 10 100 238.392
88 adidas Sports Goods (Shanghai) Co., Ltd Shanghai (China) CNY - 87 100 -
89 Runtastic Software Technology (Shanghai) Co., Ltd. Shanghai (China) CNY - 10 100 -
90 Zhuhai adidas Technical Services Limited Zhuhai (China) CNY 42.458 81 100 (4.876)
91 adidas Logistics (Tianjin) Co., Ltd. Tianjin (China) CNY 151.388 15 100 10.293
92 adidas Business Services (Dalian) Limited Dalian (China) CNY 9.439 10 100 651
93 adidas Japan K.K. Tokyo (Japan) JPY 15.943.471 10 100 3.096.204
94 adidas Korea LLC. Seoul (Korea) KRW 203.106.999 directly 100 136.770.019
95 adidas Korea Technical Services Limited Pusan (Korea) KRW 3.894.309 81 100 (264.460)
96 adidas India Private Limited New Delhi (India) INR 4.636.148 directly 10,67 (3.239)
10 89,33
97 adidas India Marketing Private Limited New Delhi (India) INR 6.042.126 96 98,62 1.263.444
10 1,00
directly 0,37
98 adidas Technical Services Private Limited New Delhi (India) USD 3.407 81 100 61
99 Reebok India Company New Delhi (India) INR (21.851.375) 109 93,15 301.426
100 PT adidas Indonesia Jakarta (Indonesia) IDR 383.423.936 10 99 152.595.628

directly 1
101 adidas (Malaysia) Sdn. Bhd. Petaling Jaya (Malaysia) MYR 58.014 directly 60 43.514
10 40
102 adidas Philippines Inc. Pasig City (Philippines) PHP 822.484 directly 100 420.375
103 adidas Singapore Pte. Ltd. Singapore (Singapore) SGD 9.062 directly 100 2.493
104 adidas Taiwan Limited Taipei (Taiwan) TWD 1.774.204 10 100 1.187.901
105 adidas (Thailand) Co., Ltd. Bangkok (Thailand) THB 1.419.989 directly 100 802.508
106 adidas Australia Pty Limited Mulgrave (Australia) AUD 88.584 10 100 33.621
107 adidas New Zealand Limited Auckland (New Zealand) NZD 6.115 directly 100 5.041
108 adidas Vietnam Company Limited Ho Chi Minh City (Vietnam) VND 224.561.408 10 100 132.119.446
109 Reebok (Mauritius) Company Limited Port Louis (Mauritius) USD (154) 76 99 (12)
71 1
54


Share in capital
held by 1)
Latin America
110 adidas Argentina S.A. Buenos Aires (Argentina) ARS 1.280.248 10 76,96 (767.560)
2 23,04
111 Reebok Argentina S.A. 3) Buenos Aires (Argentina) ARS 89.365 11 96,25 (89.777)
10 3,75
112 adidas do Brasil Ltda. São Paulo (Brazil) BRL 571.730 2 100 (211.372)
113 adidas Franchise Brasil Servicos Ltda. São Paulo (Brazil) BRL 36.088 112 100 16.121
114 Reebok Produtos Esportivos Brasil Ltda. 3) Jundiaí (Brazil) BRL 10.469 10 100 1.101
115 adidas Chile Limitada Santiago de Chile (Chile) CLP 116.551.782 directly 99 13.305.387
1 1
116 adidas Colombia Ltda. Bogotá (Colombia) COP (45.422.402) directly 100 1.990.327
117 adidas Perú S.A.C. Lima (Peru) PEN 95.948 directly 99,21 43.341
115 0,79
118 adidas de Mexico, S.A. de C.V. Mexico City (Mexico) MXN 1.346.420 directly 100 669.522
119 adidas Industrial, S.A. de C.V. Mexico City (Mexico) MXN 362.084 directly 100 61.085
120 Reebok de Mexico, S.A. de C.V. 3) Mexico City (Mexico) MXN (1.260.310) directly 100 (18.059)
121 adidas Latin America, S.A. Panama City (Panama) USD (72.607) directly 100 7.532
122 Concept Sport, S.A. Panama City (Panama) USD 1.988 10 100 366
123 adidas Market LAM, S.A. 3) Panama City (Panama) USD (2.782) 10 100 (2.782)
124 3 Stripes S.A. (adidas Uruguay) 3) Montevideo (Uruguay) UYU (436) directly 100 -
125 Tafibal S.A. Montevideo (Uruguay) UYU 37.568 directly 100 18.459
126 Raelit S.A. Montevideo (Uruguay) UYU 48.959 directly 100 8.329
127 Reebok Central America S.A. 4) San Pedro Sula (Honduras) HNL - 76 99,6 -
71 0,4
128 adidas Corporation de Venezuela, S.A. 3) Caracas (Venezuela) VEF (17) directly 100 -
129 adisport Corporation San Juan (Puerto Rico) USD (2.605) 10 100 246
1) The number refers to the number of the company.

2) Profit and loss transfer agreement
3) Companies with no active business
4) Sub-group Reebok International Ltd.
5) Sub-group Reebok International Limited
6) Sub-group adidas Indy, LLC (formerly: Sports Licensed Division of the adidas Group, LLC)
55
Independent Auditor’s Report
To adidas AG, Herzogenaurach
Report on the Audit of the Annual Financial Statements and of the Management
Report
Opinions
We have audited the annual financial statements of adidas AG, Herzogenaurach, which
comprise the balance sheet as at December 31, 2017, and the statement of profit and
loss for the financial year from January 1, 2017 to December 31, 2017, and notes to the
financial statements, including the recognition and measurement policies presented
therein. In addition, we have audited the report on the position of the Company and the
Group (“management report”) of adidas AG, Herzogenaurach for the financial year
from January 1, 2017 to December 31, 2017. In accordance with the German legal
requirements we have not audited the content of the non-financial statement, as such
included in the management report, and the corporate governance statement as well
as the corporate governance report which are included in section ”Corporate
Governance Report including the Declaration on Corporate Governance” of the
management report.
In our opinion, on the basis of the knowledge obtained in the audit,

– the accompanying annual financial statements comply, in all material respects, with
the requirements of German commercial law applicable to business corporations
and give a true and fair view of the assets, liabilities and financial position of the
Company as at December 31. 2017 and of its financial performance for the financial
year from January 1, 2017 to December 31, 2017 in compliance with German Legally
Required Accounting Principles, and
56
– the accompanying management report as a whole provides an appropriate view of

the Company’s position. In all material respects, this management report is
consistent with the annual financial statements, complies with German legal
requirements and appropriately presents the opportunities and risks of future
development. Our opinion on the management report does not cover the content of
the non-financial statement, the corporate governance statement and the corporate
governance report mentioned above.
Pursuant to Section 322 (3) sentence 1 HGB [Handelsgesetzbuch: German

Commercial Code], we declare that our audit has not led to any reservations relating
to the legal compliance of the annual financial statements and of the management
report.
Basis for the Opinions
We conducted our audit of the annual financial statements and of the management
report in accordance with Section 317 HGB and the EU Audit Regulation No. 537/2014
(referred to subsequently as “EU Audit Regulation”) and in compliance with German
Generally Accepted Standards for Financial Statement Audits promulgated by the
Institut der Wirtschaftsprüfer [Institute of Public Auditors in Germany] (IDW). Our
responsibilities under those requirements and principles are further described in the
“Auditor’s Responsibilities for the Audit of the Annual Financial Statements and of the
Management Report” section of our auditor’s report. We are independent of the
Company in accordance with the requirements of European law and German
commercial and professional law, and we have fulfilled our other German professional
responsibilities in accordance with these requirements. In addition, in accordance with
Article 10 (2) point (f) of the EU Audit Regulation, we declare that we have not provided
non-audit services prohibited under Article 5 (1) of the EU Audit Regulation. We believe
that the evidence we have obtained is sufficient and appropriate to provide a basis for
our opinions on the annual financial statements and on the management report.
57
Key Audit Matters in the Audit of the Annual Financial Statements
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the annual financial statements for the financial year from
January 1, 2017 to December 31, 2017. These matters were addressed in the context
of our audit of the annual financial statements as a whole, and in forming our opinion
thereon, we do not provide a separate opinion on these matters.
Recoverability of Financial Assets

For information on the accounting and valuation methods used, please refer to the
section "Accounting and valuation principles" and to the balance sheet of financial
assets in Note 3.
THE RISK TO THE FINANCIAL STATEMENTS

As of December 31, 2017, adidas AG, Herzogenaurach, annual financial statements
item “financial assets” includes “shares in affiliated companies” in the amount of
EUR 4.126 million. This represents 46.6 % of the balance sheet and thus has a
significant influence on the overall picture of the Company’s financial position.
Management of adidas AG values the financial assets at cost or, if impairment is
expected to be permanent, at the lower fair value. The fair value is highly dependent
on the assumptions made and is therefore subject to significant judgement. In
particular, there is significant judgement involved in determining whether the
estimation of future cash flows and growth rates, the weighted average cost of capital
and the assessment of the permanence of the impairment or reversal of impairment
are appropriate.
There is a risk to the annual financial statements that an impairment or reversal of
impairment at the balance sheet date has not been recognized.
OUR AUDIT APPROACH

We conducted our audit using a risk-based approach. First, we used information we
obtained throughout our audit to assess which shares in affiliates have indications of
impairment.
58
Our audit procedures also included amongst others assessing the appropriateness of
the valuation model used by the Company. We assessed whether the methodology of
deriving the valuations and the discount rates used by Management were appropriate.
In doing so, we determined our own expected values for the parameters on which the
weighted average cost of capital is based (including the risk-free interest rate, market
risk premium, beta factor) and compared these with Management’s assumptions. We
involved KPMG valuation specialists to support the audit team in making the
assessments.
In addition, we assessed whether the cash flow projections underlying the valuations
are based on appropriate and reasonable assumptions. We inquired of Management
to obtain explanations for these assumptions, as well as their assessment of the
impact of strategic and operational measures on cash flow projections. The long-term
earnings forecasts were also critically assessed by reviewing industry benchmarks to
determine whether the forecast amounts and assumptions underlying these forecasts
are appropriate. When possible, we assessed the reliability and accuracy of their
projections by comparing historical forecasts with actual results. Finally, we discussed
the valuations determined by adidas AG with the legal entity controlling department
and recalculated the resulting valuations.
OUR CONCLUSIONS
The valuation model used by adidas AG is appropriate and in accordance with the
applicable accounting guidelines. The assumptions used by Management in their
valuations are unbiased.
Valuation and Accuracy of Stock-Based Compensation Programs

For information on the accounting and valuation methods used, please refer to the
section "Accounting and valuation principles" and to the information on share-based
payment programs in sections 9 of the notes.
59
THE RISK TO THE FINANCIAL STATEMENTS

In 2017, adidas AG launched a new share-based compensation program for executives
and introduced an indefinite-term employee participation program as of October 1,
2016. In addition, a share based compensation program was agreed to for an artist and
a designer (non-employees), with a contract date of May 19, 2016 for the years 2017 to
2021. The respective programs contain various vesting conditions, which are linked to
grants of equity instruments or a cash settlement. As of December 31, 2017, adidas
has accrued a total of EUR 7 million in stock-based compensation expense recorded
in equity, EUR 1 million in sales provisions and EUR 9 million in personnel provisions.
The interpretation of the contractual agreements is complex. Furthermore, the
assessment of whether the vesting conditions will be achieved as of the balance sheet
date and during the vesting period involves judgement.
There is a risk to the annual financial statements that the accounting of the share-
based payment programs is not in accordance with HGB and that the valuation of the
equity instruments granted or the respective liability is inaccurate.
OUR AUDIT APPROACH

We first assessed whether the criteria were met for classification as share-based
payment programs according to prevailing German commercial literature. For this
purpose, we analyzed the contractual obligations of the respective programs in detail
and evaluated their treatment under the guidance. We identified and assessed the
goods or services to be received from adidas AG under the programs, and we assessed
whether they should be treated as equity-settled or cash-settled share-based
payments.
Among other things, we assessed the valuation model and the reasonableness of the
assumptions used for vesting conditions (employee turnover) and performance
conditions (stock price at the end of the vesting period). In doing so, we compared
assumptions used for vesting conditions with historical employee turnover, and
compared projections for future share prices with actuarial valuation models.
By examining the respective contracts and the related accounting treatment, we
ensured that the underlying assumptions regarding the likelihood of achieving vesting
60
conditions were reasonable as of the reporting date, and that the accounting for the
share-based programs was appropriate.
OUR CONCLUSIONS
The share-based compensation programs have been classified appropriately in
accordance with prevailing German commercial literature. The valuation methods
used are appropriate, and the assumptions underlying the valuation regarding the
achievement of vesting conditions as of the reporting date have been reasonably
estimated.
Other Information
Management is responsible for the other information. The other information

comprises:
– the non-financial statement,
– the corporate governance statement, and
– the Corporate Governance Report in accordance with Nr. 3.10 of German Corporate
Governance Code.
Our opinions on the annual financial statements and on the management report do not
cover the other information, and consequently we do not express an opinion or any
other form of assurance conclusion thereon.
In connection with our audit, our responsibility is to read the other information and, in
so doing, to consider whether the other information
– is materially inconsistent with the annual financial statements, with the
management report or our knowledge obtained in the audit, or
– otherwise appears to be materially misstated.
We were engaged to perform a separate independent limited assurance engagement
on the non-financial statement. With regards to content, scope and results of this
independent limited assurance engagement we refer to our report hereon from
February 23, 2018.
61
Responsibilities of Management and the Supervisory Board for the Annual Financial
Statements and the Management Report
Management is responsible for the preparation of the annual financial statements that
comply, in all material respects, with the requirements of German commercial law
applicable to business corporations, and that the annual financial statements give a
true and fair view of the assets, liabilities, financial position and financial performance
of the Company in compliance with German Legally Required Accounting Principles.
In addition, management is responsible for such internal control as they, in
accordance with German Legally Required Accounting Principles, have determined
necessary to enable the preparation of annual financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the annual financial statements, management is responsible for
assessing the Company’s ability to continue as a going concern. They also have the
responsibility for disclosing, as applicable, matters related to going concern. In
addition, they are responsible for financial reporting based on the going concern basis
of accounting, provided no actual or legal circumstances conflict therewith.
Furthermore, management is responsible for the preparation of the management
report that as a whole provides an appropriate view of the Company’s position and is,
in all material respects, consistent with the annual financial statements, complies with
German legal requirements, and appropriately presents the opportunities and risks of
future development. In addition, management is responsible for such arrangements
and measures (systems) as they have considered necessary to enable the preparation
of a management report that is in accordance with the applicable German legal
requirements, and to be able to provide sufficient appropriate evidence for the
assertions in the management report.
The supervisory board is responsible for overseeing the Company’s financial reporting
process for the preparation of the annual financial statements and of the management
report.
62
Auditor’s Responsibilities for the Audit of the Annual Financial Statements and of
the Management Report
Our objectives are to obtain reasonable assurance about whether the annual financial
statements as a whole are free from material misstatement, whether due to fraud or
error, and whether the management report as a whole provides an appropriate view
of the Company’s position and, in all material respects, is consistent with the annual
financial statements and the knowledge obtained in the audit, complies with the
German legal requirements and appropriately presents the opportunities and risks of
future development, as well as to issue an auditor’s report that includes our opinions
on the annual financial statements and on the management report.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with Section 317 HGB and the EU Audit Regulation and in
compliance with German Generally Accepted Standards for Financial Statement
Audits promulgated by the Institut der Wirtschaftsprüfer (IDW) will always detect a
material misstatement. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these
annual financial statements and this management report.
We exercise professional judgment and maintain professional skepticism throughout
the audit. We also:
– Identify and assess the risks of material misstatement of the annual financial
statements and of the management report, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinions. The risk of not
detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal controls.
– Obtain an understanding of internal control relevant to the audit of the annual
financial statements and of arrangements and measures (systems) relevant to the
audit of the management report in order to design audit procedures that are
63
appropriate in the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of these systems of the Company.
– Evaluate the appropriateness of accounting policies used by management and the
reasonableness of estimates made by management and related disclosures.
– Conclude on the appropriateness of the management’s use of the going concern
basis of accounting and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on
the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in the auditor’s report to the
related disclosures in the annual financial statements and in the management
report or, if such disclosures are inadequate, to modify our respective opinions. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Company to cease to be
able to continue as a going concern.
– Evaluate the overall presentation, structure and content of the annual financial
statements, including the disclosures, and whether the annual financial statements
present the underlying transactions and events in a manner that the annual
financial statements give a true and fair view of the assets, liabilities, financial
position and financial performance of the Company in compliance with German
Legally Required Accounting Principles.
– Evaluate the consistency of the management report with the annual financial
statements, its conformity with [German] law, and the view of the Company’s
position it provides.
– Perform audit procedures on the prospective information presented by
management in the management report. On the basis of sufficient appropriate audit
evidence we evaluate, in particular, the significant assumptions used by
management as a basis for the prospective information, and evaluate the proper
derivation of the prospective information from these assumptions. We do not
express a separate opinion on the prospective information and on the assumptions
used as a basis. There is a substantial unavoidable risk that future events will differ
materially from the prospective information.
64
We communicate with those charged with governance regarding, among other

matters, the planned scope and timing of the audit and significant audit findings,
including any significant deficiencies in internal control that we identify during our
audit.
We also provide those charged with governance with a statement that we have
complied with the relevant independence requirements, and communicate with them
all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, the related safeguards.
From the matters communicated with those charged with governance, we determine
those matters that were of most significance in the audit of the annual financial
statements of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter.
Other Legal and Regulatory Requirements
Further Information pursuant to Article 10 of the EU Audit Regulation
We were elected as auditor by the annual general meeting on May 11, 2017. We were
engaged by the supervisory board on October 13, 2017. We have been the auditor of
the adidas AG as a listed entity since 1995 without interruption.
We declare that the opinions expressed in this auditor’s report are consistent with the
additional report to the audit committee pursuant to Article 11 of the EU Audit
Regulation (long-form audit report).
65
German Public Auditor Responsible for the Engagement
The German Public Auditor responsible for the engagement is Haiko Schmidt.
Munich, February 23, 2018

KPMG AG
Wirtschaftsprüfungsgesellschaft
[Original German version signed by:]
Braun Schmidt
Wirtschaftsprüfer Wirtschaftsprüfer
[German Public Auditor] [German Public Auditor]
66
Responsibility Statement
To the best of our knowledge, and in accordance with the applicable reporting
principles, the annual financial statements give a true and fair view of the assets,
liabilities, financial position and profit or loss of the company, and the Management
Report, which has been combined with the Group Management Report, includes a
fair review of the development and performance of the business and the position of
the company, together with a description of the material opportunities and risks
associated with the expected development of the company.
Herzogenaurach, February 23, 2018
The Executive Board

67
Supervisory Board Report
DEAR SHAREHOLDERS,
We look back on another exceptional year. Thanks to strong brands, unique

partnerships and collaborations in the world of sport as well as a sharp focus on our
consumers’ needs, the company was able to record another year of strong top- and
bottom-line growth. Driven by innovative products and powerful marketing campaigns,
the momentum experienced by our brands remained high throughout the year. This led
to sales and earnings results that clearly surpassed targets set at the beginning of the
year. These positive developments are the consequence of numerous measures which
have been implemented to support the successful execution of our strategic business
plan ‘Creating the New’. First introduced in 2015, Creating the New was updated with
several complementary initiatives at the beginning of 2017 in order to grow the top and
bottom line even faster than initially projected. Consequently, adidas updated its outlook
for 2020 and presented an even more ambitious set of financial targets. In 2017 again,
we generated double-digit sales growth rates in almost all regions, including in the
focus markets North America and Greater China as well as the important e-commerce
channel. Paired with an exceptional profitability improvement, this shows that the
company’s success is both broad-based and well balanced. The divestiture of the
TaylorMade, Adams Golf and Ashworth brands as well as the CCM Hockey business was
completed during the course of 2017, which will allow the company to focus even more
on the execution of its strategic business plan. Newly appointed members of the
Executive Board have assumed their roles fast and smoothly, with Harm Ohlmeyer
taking over as Chief Financial Officer, Karen Parkin being elevated to Executive Board
Member responsible for Human Resources and Gil Steyaert becoming Executive Board
Member responsible for Global Operations. All three appointments were internal ones,
which speaks to the quality and depth of the organization’s pool of talent. Taking all this
68
into consideration, the company is well positioned to continue to grow profitably in 2018
and beyond.
SUPERVISION AND ADVICE IN DIALOGUE WITH THE EXECUTIVE BOARD

In the year under review, we performed all of our tasks laid down by law, the Articles of
Association, the German Corporate Governance Code (the ‘Code’) and the Rules of
Procedure carefully and conscientiously, as in previous years. In 2017, we also followed
intensively the work of the Executive Board. In this context, we regularly advised the
Executive Board on the management of the company and diligently and continuously
supervised its management activities. We assured ourselves of the legality, expediency
and regularity of the management activities and found that there were no objections to
be raised.
The Executive Board involved us directly and in a timely and comprehensible manner in
all of the company’s fundamental decisions. After in-depth consultation and examination
of the detailed information submitted to us by the Executive Board, we approved
individual transactions where required by law.
The Executive Board informed us extensively and in a timely manner through written
and oral reports. This information covered all relevant aspects of the company’s
business strategy, business planning, including finance, investment and personnel
planning, the course of business and the company’s financial position and profitability.
We were also kept up to date on matters relating to the risk situation, risk management
and compliance as well as all major decisions and business transactions.
The Executive Board always explained immediately and in a detailed manner any
deviations in business performance from the established plans, and the Supervisory
Board as a whole discussed these matters in depth.
69
The Executive Board regularly provided us with comprehensive written reports for the
preparation of our meetings. We thus always had the opportunity to critically analyze the
Executive Board's reports and resolution proposals within the committees and within
the Supervisory Board as a whole and to put forward suggestions before passing
resolutions after in-depth examination and consultation. At the Supervisory Board
meetings, the Executive Board was available to discuss and answer our questions. In the
periods between our meetings, the Executive Board also provided us with extensive,
timely monthly reports on the current business situation. We critically examined,
specifically challenged and checked the plausibility of the information provided by the
Executive Board.
In the year under review, we held seven regular meetings of the entire Supervisory
Board, two of which took place outside Germany. The attendance rate of the members in
the Supervisory Board meetings was around 95% in the year under review. The
committee meetings, with the exception of one General Committee meeting and two
Finance and Investment Committee meetings from which one member was excused in
each case, were fully attended. The external auditor, KPMG AG
Wirtschaftsprüfungsgesellschaft (‘KPMG’), attended all regular meetings of the
Supervisory Board – the exception being the two meetings which took place outside
Germany – insofar as no Executive Board matters were dealt with. KPMG also attended
all meetings of the Audit Committee.
In the periods between meetings, the Supervisory Board Chairman and the Audit
Committee Chairman maintained regular contact with the Chief Executive Officer and
the Chief Financial Officer, conferring on matters such as corporate strategy, business
planning and development, the risk situation and risk management as well as
compliance. In addition, the Executive Board immediately informed the Supervisory
Board Chairman about any significant events of fundamental importance for the
70
management and for evaluating the situation and development of the company, where
necessary also at short notice.
TOPICS FOR THE ENTIRE SUPERVISORY BOARD

Our consultations and examinations focused on the following topics:
SITUATION AND BUSINESS DEVELOPMENT

The development of sales and earnings, the employment situation as well as the
financial position of the company and the business development of the company's
individual business areas and markets were presented to us in detail by the Executive
Board at every Supervisory Board meeting and were discussed regularly. Further topics
which were always discussed were the possible impact of global economic
developments as well as the development of our individual brands and markets.
At our February and March meeting, we dealt with the ‘Acceleration Plan’ and with the
updated financial targets for 2020. Various initiatives for the key pillars ‘Portfolio, adidas
North America, ONE adidas, Digital’ were launched in the context of the Acceleration
Plan. Those initiatives aim at supporting the momentum experienced by our brands and
accelerating sales and net income growth compared to the original five-year plan.
In August, we examined the topic of retail profitability. Furthermore, we dealt with the
CSR Directive Implementation Act and the non-financial reporting legally required for
the first time therein. In this connection, we assigned the Audit Committee the task of
preparing the audit of the non-financial reporting by the Supervisory Board. We
commissioned an external examination of the content pursuant to § 111 section 2
sentence 4 German Stock Corporation Act (Aktiengesetz - AktG). One topic of the
October meeting was a detailed and sound analysis of the strategic business plan. In
addition, the business in the Asia/Pacific region was discussed. At the December
71
meeting, as stipulated in the Rules of Procedure of the Supervisory Board, one agenda
item was the report by the Executive Board on the marketing and sponsorship
agreements concluded in the respective calendar year.
TRANSACTIONS REQUIRING SUPERVISORY BOARD APPROVAL

In accordance with statutory regulations and the Rules of Procedure of the Supervisory
Board, certain transactions and measures require a formal resolution or the prior
approval of the Supervisory Board.
The topic of our February and March meetings was, after thorough discussion, the
approval of the 2017 Budget and Investment Plan presented by the Executive Board. In
March, we resolved upon the resolutions to be proposed to the 2017 Annual General
Meeting, including the proposal regarding the appropriation of retained earnings for the
2016 financial year as well as the proposal to change the Supervisory Board
compensation.
At our February meeting, we additionally dealt with the planned divestiture of

TaylorMade, Adams Golf, Ashworth and CCM Hockey and the integration of the FiveTen
brand into adidas Outdoor. The competent Finance and Investment Committee
ultimately approved the sale of TaylorMade and CCM Hockey.
COMPOSITION OF THE EXECUTIVE BOARD

Following in-depth discussions about the resolution proposal prepared by the General
Committee on the appointment of Harm Ohlmeyer as successor to the long-standing
Chief Financial Officer Robin J. Stalker, we resolved at our March meeting to appoint
Harm Ohlmeyer as Executive Board member with effect from March 7, 2017 and as
Chief Financial Officer with effect from the end of the Annual General Meeting on May
11, 2017. We also resolved upon the conclusion of his Executive Board service contract.
Prior to this, we had approved the mutually agreed termination of the Executive Board
72
mandate of Robin J. Stalker with effect from the end of the Annual General Meeting on
May 11, 2017. Furthermore, after in depth-consultation, we approved the conclusion of
the corresponding termination agreement regarding the Executive Board service
contract.
At the May meeting, we furthermore approved the mutually agreed termination of the
long-standing Executive Board mandate of Glenn Bennett by the end of the third
quarter of 2017 at the latest and approved the termination agreement to be concluded.
In this context, we appointed Gil Steyaert, successor to Glenn Bennett, as Executive
Board member with effect from May 12, 2017 and approved the conclusion of his
Executive Board service contract.
Furthermore, Karen Parkin was appointed as member of the Executive Board for the
newly created Executive Board function Human Resources. We resolved upon the
appointment of Karen Parkin as member of the Executive Board with effect from May 12,
2017 and approved the conclusion of her Executive Board service contract.
In December, we resolved upon the termination of the appointment and the concurrent
reappointment of Roland Auschel and Eric Liedtke with effect from January 1, 2018 and
approved the conclusion of their new Executive Board service contracts. Thus, we were
able to commit Roland Auschel and Eric Liedtke long-term to the company as both of
them are key for the company and its successful development.
EXECUTIVE BOARD COMPENSATION

All matters regarding Executive Board compensation were prepared comprehensively
by the General Committee, as provided for in the Rules of Procedure of the Supervisory
Board, explained to the Supervisory Board as a whole and submitted for resolution.
Each year at our February meeting of the entire Supervisory Board, the main subject is
Executive Board compensation. At this meeting, following an in-depth review of the
73
performance of the individual Executive Board members and their respective

achievement of the targets set in the 2016 Performance Bonus Plan, we resolved upon
the bonuses to be paid to the Executive Board members based on the 2016 Performance
Bonus Plan. Furthermore, we also discussed in detail the criteria and key targets for the
2017 Performance Bonus Plan and the individual bonus target amounts and determined
them for each Executive Board member.
In line with the Code, in the year under review we commissioned an external,
independent compensation expert to review the structure of the Executive Board
compensation and the individual compensation levels of the Executive Board members.
The review found that the compensation meets the requirements of the German Stock
Corporation Act and of the Code. However, current compensation levels could be
oriented even more toward market standards. At our meetings in February and October,
we considered in detail the results of the review of the compensation levels and
structure. We agreed with the compensation expert’s assessment. On this basis and on
the occasion of the reappointments of Roland Auschel and Eric Liedtke, we resolved in
December to adjust their compensation in accordance with the results of the review by
the independent compensation expert with effect from January 1, 2018.
COMPOSITION OF AND CHANGES ON THE SUPERVISORY BOARD
There were no personnel changes with regard to the full Supervisory Board in the
reporting period. At the March meeting of the Audit Committee, the composition of the
Audit Committee was addressed. Dr. Stefan Jentzsch stated that he would leave the
Audit Committee for professional reasons. As his replacement, Ian Gallienne was
elected as new member of the Audit Committee. At the May meeting of the Audit
Committee, Herbert Kauffmann was re-elected as Chairman of the Audit Committee.
With regard to the representation of women and men, the Supervisory Board complies
with the statutory minimum quota pursuant to § 96 section 2 sentences 1, 3 and 4 AktG.
74
Both the shareholder representatives and the employee representatives resolved in

accordance with § 96 section 2 sentence 3 AktG that the minimum quota of 30% women
and 30% men on the Supervisory Board shall be fulfilled separately for the shareholder
representatives and the employee representatives.
The term of office of the Supervisory Board members, including the four members who
were elected as new shareholder or employee representatives in the supplementary
election, will expire as scheduled at the end of the Annual General Meeting in May 2019.
CORPORATE GOVERNANCE
The Supervisory Board regularly monitors the application and further development of
the corporate governance regulations within the company, in particular the
implementation of the recommendations of the Code. Therefore, in the year under
review, we also dealt with the Code, in particular with the amendments resolved upon by
the Government Commission on February 7, 2017.
The last Declaration of Compliance was issued by the Executive Board and Supervisory
Board of adidas AG pursuant to § 161 AktG on February 13, 2017.
In February 2018, we discussed in depth the current 2018 Declaration of Compliance

and then resolved upon it and made it permanently available to our shareholders on our
corporate website.
At our May, August, October and December meetings, within the framework of our
regular self-evaluation, we dealt with the planning and preparation of a new efficiency
examination of the Supervisory Board and Audit Committee which began in late 2017
and will be concluded in 2018.
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Pursuant to the new recommendation of the Code, we also developed a competency

profile for the full Supervisory Board. Under consideration of the specific features which
result from the activities of the organization as a globally present, public listed company,
we ensured that the full Supervisory Board has the knowledge, skills and professional
expertise required to properly perform its duties. Details can be found in the Corporate
Governance Report including the Declaration on Corporate Governance (‘Corporate
Governance Report’).
In December, we discussed the independence of the members of the Supervisory Board

and the respective independence criteria. A corresponding resolution was passed in
February 2018. Based thereon, in the Supervisory Board’s assessment, currently all
members are independent.
In the year under review, no conflicts of interest arose in regard to the Executive Board
members. There were also no conflicts of interest within the Supervisory Board. It is
pointed out that in December 2015, the Supervisory Board approved the conclusion of a
three-year contract, effective January 1, 2016, with a company in which one Supervisory
Board member is involved. The order volume is to be confirmed annually by the
Supervisory Board. A resolution was passed by the Supervisory Board as regards the
order volume for the 2018 financial year at the meeting in December 2017. In the view of
the Supervisory Board, there was no conflict of interest. Nevertheless, as in the previous
years, the Supervisory Board member concerned did not participate in the respective
resolution.
Further information on corporate governance within the company can be found in the
Corporate Governance Report.
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EFFICIENT COMMITTEE WORK

In order to perform our tasks in an efficient manner, we have established a total of six
standing Supervisory Board committees.
The committees prepare resolutions and topics for the meetings of the entire
Supervisory Board. Within the legally permissible framework and in appropriate cases,
we have furthermore delegated the Supervisory Board‘s authority to pass certain
resolutions to individual committees. With the exception of the Audit Committee, the
Supervisory Board Chairman also chairs all the standing committees. The committee
chairpersons inform the Supervisory Board about the content and results of the
committee meetings at the subsequent meeting of the entire Supervisory Board.
• The Steering Committee did not meet in the year under review.
• The General Committee held six meetings in the 2017 financial year. The main
focus of the meetings was the preparation of the resolutions of the Supervisory
Board as a whole, detailed individually above, in particular the resolution on the
changes on the Executive Board, the targets for the 2017 Performance Bonus, the
target achievement of the 2016 Performance Bonus and the determination of the
Executive Board compensation and the review of its appropriateness. The drafting
of the long-term compensation plan 2018/2020 (LTIP 2018/2020) was also an
agenda item.
• The Audit Committee also held six meetings in the year under review. The Chief
Financial Officer and the auditor were present at all meetings and reported to the
committee members in detail.
In addition to the supervision of the accounting process, the committee's work

also focused on the comprehensive review of the first quarter report, the first half
77
year report and the report on the first nine months together with the Chief
Financial Officer and the auditor before the respective dates of publication, also
the examination of the annual financial statements and the consolidated financial
statements for 2016, including the combined Management Report of adidas AG
and the Group, as well as the Executive Board's proposal regarding the
appropriation of retained earnings. Following an in-depth review of the audit
reports with the auditor, the committee decided to recommend that the
Supervisory Board approve the 2016 annual financial statements and
consolidated financial statements. In addition, after obtaining the auditor‘s
declaration of independence and after conclusion of a disclosure agreement, the
Audit Committee prepared the Supervisory Board's proposal to the Annual
General Meeting concerning the selection of the auditor of the annual financial
statements and the consolidated financial statements for the 2017 financial year
and the auditor for the audit review of interim management reports (half year
report and quarterly reports) for the 2017 financial year and, insofar as interim
financial reports are to be prepared prior to the 2018 Annual General Meeting, for
the 2018 financial year and recommended that the Supervisory Board propose
KPMG to the Annual General Meeting in this respect. The Audit Committee
declared to the Supervisory Board in this regard that the recommendation is free
from undue influence by a third party and that no clause of the kind referred to in
Article 16 section 6 of the EU Regulation No. 537/2014 of the European
Parliament and of the Council of April 14, 2014 on specific requirements
regarding the statutory audit of public-interest entities has been imposed upon it.
In the year under review, the CSR Directive Implementation Act was a regularly
discussed topic at Audit Committee meetings. In particular, the Audit Committee
dealt with the preparation of the non-financial reporting which is to be audited by
the Supervisory Board and which is legally required for the first time.
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Furthermore, the Audit Committee dealt intensively with the monitoring of the
effectiveness of the risk management system, the compliance management
system, the internal control system and the internal audit system. Moreover, the
committee addressed the findings of Internal Audit and the audit plan.
In addition, at every meeting of the Audit Committee, the Chief Compliance Officer
gave regular reports.
• The Finance and Investment Committee held two meetings in the year under
review, both of which were held by way of a conference call.
At the May meeting, the sale of TaylorMade was discussed and subsequently
approved in May following the meeting. At the June meeting, the committee
approved the divestiture of CCM Hockey.
• The Nomination Committee held one meeting in the year under review to discuss
the competency profile newly recommended by the Code.
• The Mediation Committee, established in accordance with the German Co-

Determination Act (Mitbestimmungsgesetz — MitbestG), did not have to be
convened in 2017.
EXAMINATION OF THE 2017 ANNUAL FINANCIAL STATEMENTS AND CONSOLIDATED

FINANCIAL STATEMENTS
KPMG audited the 2017 consolidated financial statements prepared by the Executive
Board in accordance with § 315e German Commercial Code (Handelsgesetzbuch – HGB)
in compliance with IFRS and issued an unqualified opinion thereon. The auditor also
approved without qualification the 2017 annual financial statements of adidas AG,
prepared in accordance with HGB requirements, and the combined Management Report
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of adidas AG and the Group. Furthermore, at the request of the Supervisory Board,
KPMG audited the non-financial statement, which had to be prepared for the first time.
The financial statements, the proposal put forward by the Executive Board regarding the
appropriation of retained earnings and the auditor’s reports were distributed by the
Executive Board to all Supervisory Board members in a timely manner. We examined
the documents in depth, with a particular focus on legality and regularity, in the
presence of the auditor at the Audit Committee meeting held on March 2, 2018 and at
the Supervisory Board’s March 6, 2018 financial statements meeting, during which the
Executive Board explained the financial statements in detail. At both meetings, the
auditor reported the material results of the audit, inter alia with regard to the priority
topics agreed and the key audit matters and was available for questions and the
provision of additional information. The auditor did not report any significant
weaknesses with respect to the internal control and risk management system relating
to the accounting process. We also discussed in depth with the Executive Board the
proposal concerning the appropriation of retained earnings, which provides for a
dividend of € 2.60 per dividend-entitled share and adopted this significant increase to
€ 2.60 compared with the previous year under consideration of the strong business
development in the 2017 financial year, the company's good financial situation and
future prospects. Based on our own examinations of the annual and consolidated
financial statements (including the non-financial statement), we came to the conclusion
that there are no objections to be raised. At our financial statements meeting, therefore,
following the recommendation of the Audit Committee, we approved the audit results
and the financial statements including the non-financial statement prepared by the
Executive Board. The annual financial statements of adidas AG were thus approved.
EXPRESSION OF THANKS
On behalf of the entire Supervisory Board, I wish to thank the members of the Executive
Board and all adidas employees around the world for their great personal dedication
80
and their ongoing commitment, and I also thank the employee representatives for their
trusting collaboration.
I would particularly like to thank our departed long-standing Executive Board members
Glenn Bennett and Robin J. Stalker who sustainably shaped the company. The success
story of adidas is closely linked to Glenn Bennett’s responsibilities in the area of Global
Operations. During Robin J. Stalker’s term of office as CFO, the company’s value
increased from € 3 billion to more than € 30 billion. These are outstanding
achievements, for which I would like to express my sincere appreciation to Glenn
Bennett and Robin J. Stalker on behalf of the Supervisory Board and all adidas
employees.
For the Supervisory Board
IGOR LANDAU
Chairman of the Supervisory Board
March 2018
adidas AG
Adi-Dassler-Str. 1
91074 Herzogenaurach
Germany
www.adidas-Group.com

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F I N A N C I A L S TAT E M E N T S

FOR THE YEAR ENDED

3 Information on the combined Management Report

43 Statements of Changes in Fixed Assets

45 Supervisory Board and Executive Board

67 Supervisory Board Report

Combined Management Report

Annual financial statements of adidas AG

FIXED ASSETS (1)

ACTIVE DIFFERENCE RESULTING FROM ASSET OFFSETTING (8) 4,971 3,917

EQUITY AND LIABILITIES

PROVISIONS/ACCRUALS (12) 624,043 525,005

LIABILITIES (13) 5,530,596 5,078,174

DEFERRED INCOME 1,210 835

Annual financial statements of adidas AG

Sales (15) 3,732,306 3,288,775

Other operating income (16) 502,724 439,195

Income from investments in related companies (21) 155,420 624,546

Other taxes -242 -301

Retained earnings brought forward 23,860 322,325

Notes to the annual financial statements of adidas AG for the

adidas AG is domiciled in 91074 Herzogenaurach, Adi-Dassler-Str. 1, and is

2. Intangible fixed assets and tangible fixed assets

Intangible fixed assets and tangible fixed assets

Balance as of Jan. 1 604,818 567,354

Additions 227,559 143,343

Disposals 7,730 5,470

Depreciation, amortization and write-downs 90,555 100,409

Balance as of Dec. 31 734,092 604,818

3. Long-term financial assets

The increase in long-term financial assets primarily relates to a contribution in cash

Raw materials, consumables and supplies 4,016 5,328

Finished goods and merchandise 44,819 44,157

Inventories 48,876 49,514

Inventories relate to raw materials, consumables and supplies for production

5. Receivables and other assets

Receivables and other assets

Trade accounts receivable 95,074 84,467

of which with a residual maturity of more than one year 0 0

Receivables from affiliated companies 3,111,239 2,836,311

of which with a residual maturity of more than one year 0 0

Other assets 55,252 48,158

Receivables and other assets 3,261,565 2,968,936

The receivables from affiliated companies primarily relate to receivables in

6. Cash-in-hand, central bank balances, bank balances and checks

Cash and cash equivalents

Dec. 31, 2017 Dec. 31, 2016

Cash-in-hand, bank balances and checks 337,219 27,853

Advertising and promotion agreements 87,202 59,834

Discount from valuation of conversion right attaching to convertible bond 0 4,823

Other 81,169 78,132

Prepaid expenses 168,372 142,789

In March 2012, adidas AG issued a convertible bond including prolongation option

8. Active difference resulting from asset offsetting

9. Subscribed capital and capital reserves

The table below provides an overview of the changes in equity:

Subscribed capital 209,216 0 0 0 0 0 209,216

Par value of -7,727 -473 2,845 0 0 0 0 -5,355

Capital reserves 1,260,865 0 46,473 2,594 0 0 0 1,309,932