Adidas has completed its second share buyback program this year. On March 1, 2022, the company announced the launch of another share buyback program in mid-March to return cash proceeds from the Reebok divestment to its shareholders. In the period between March 14 and Oct. 10, 2022, the company repurchased 8,978,138 shares with a total value of €1.5 billion. This corresponds to an average purchase price of €167.07 per share.
The decision to buy back shares in order to return the cash proceeds from the Reebok divestment to shareholders was in addition to the company’s regular buyback activities. In Dec. 2021, Adidas had launched a multi-year share buyback program under which the company intends to repurchase up to €4 billion worth of its own shares by 2025. The first tranche of this program took place in January and February of this year. During this period, the company bought back 4,156,558 shares worth a total of €1 billion (average purchase price of €240.58 per share). Including both share buybacks, Adidas has repurchased 13,134,696 shares for a total value of €2.5 billion in 2022. Including the dividend payment of €610 million in May, the company distributed more than €3.1 billion to its shareholders in 2022.
High cash returns are an essential part of the “Own the Game” strategy, the company said. Under the strategy, Adidas aims to generate significant cumulative free cash flow by 2025 and return the majority of this (between €8bn and €9bn) to its shareholders through regular dividend payments of between 30 and 50 percent of earnings from continuing operations and share buybacks. This regular payout will be complemented by the additional share buyback program of €1.5 billion in connection with the divestment of Reebok.
As previously announced, the company intends to cancel the majority of the shares acquired as part of its buyback activities. Accordingly, Adidas will cancel a total of 12,100,000 treasury shares in the coming weeks. This will reduce the number of shares as well as the share capital from 192,100,000 to 180,000,000.
