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WHAT IS ASICS?
Kihachiro Onitsuka founded ASICS in 1949 to nurture the youth of Japan through sports and contribute to the development of society. Today, 70 years later, that ideal remains engrained in ASICS, guiding our efforts to continuously develop innovative technologies,products and services that improve the quality of customers’ lives. Our vision is to “Create Quality Lifestyle through Intelligent Sport Technology.” Based on that vision, we have developed products that harness our accumulated expertise and technologies,winning the support of athletes worldwide and casual runners and underpinning our strong brand value today.
Going forward, we will continue to harness advanced technologies – developed through collaboration with athletes – to create products and services that make life healthier and more fun for people everywhere.
2019 HIGHLIGHTS
In FY2019, ended December 31, 2019, ASICS reported higher profits, despite a drop in sales. On a currencyneutral basis, sales increased year on year. Advertising expenses rose due to increased spending on strategic marketing. However, selling, general and administrative expenses declined, mainly reflecting cost savings from previously implemented business restructuring measures, which lifted operating income for the first time in five years.
In the Performance Running category, sales increased on a currency-neutral basis, while sales in the key US market rose for the first time in four years.
In 2019, we adopted a new management structure based around product categories, with a single executive tasked with overseeing all aspects of operations in each category – from product planning and development right through to marketing and sales.
That structure is gradually bedding down across the ASICS Group. We are also clarifying the respective roles of Head Office and sales companies to ensure the category-based management structure takes hold and supports the Group’s future growth.
OUR STRATEGY
We plan to step up efforts in each of the following priority areas by targeting resources on growth fields and improving profitability.
PRIORITY AREA
1) WIn in performance running
This is our top priority area. We will actively target the leading market position in the Performance Running category by developing and launching products that meet the performance needs of athletes in areas such as running efficiency, bounce, speed, cushion and stability. Launched in 2019, our METARIDE and GLIDERIDE high-performance running shoes, which incorporate the latest technologies, are gaining positive feedback. In February 2020, we also launched EVORIDE running shoes, which were developed based on the same concept as METARIDE and GLIDERIDE. To maximize sales opportunities for performance running shoes, we will invest in high-impact marketing activities, such as sponsorship of major marathon events in Los Angeles, Paris, Wuxi (China), the Gold Coast and other locations worldwide, with the ultimate goal of reinforcing our position in the running market.
2) develop digital as a new growth driver
We will reinforce our menu of digital services to add new value to our customers’ sports experiences. In 2019, we acquired Race Roster, the third-ranked marathon event organizer in North America, with 1.3 million registered runners. The acquisition has helped us foster even closer links with runners, particularly women and younger runners. Utilizing Race Roster and our existing Runkeeper app, we plan to add new value to customers’ sports experiences by providing a range of digital services, including tools that propose training plans for races and advice about the best running shoes and clothing for individual foot shapes and running styles.
3) expand onitsuka tiger
Ahead of our move to the category-based management structure for the whole ASICS Group, we adopted an internal company system in the Onitsuka Tiger category in 2018 to speed up the decision-making process. To cultivate Onitsuka Tiger as a premium fashion brand, we will open flagship stores in London,Milan, New York, Los Angeles and other locations, hold fashion shows and collaborate with influential brands and designers to convey Onitsuka Tiger’s worldview to consumers.
4) Expand our growth markets
We are targeting growth in the fast-developing economies of Southeast Asia, India and the Middle East. In Southeast Asia, we are focusing on Vietnam and Indonesia, aiming for solid growth in Performance Running and Onitsuka Tiger. In India, we will focus on cricket – a popular sport in India – in addition to Performance Running. In the Middle East, we first plan to establish our position in the running category to create a solid foundation for our business. To drive growth in those regions, we will implement strategies tailored to local markets to build regional product portfolios.
2020 FORECAST
Olympic and Paralympic Games Tokyo 2020 have been postponed for one year due to the outbreak of novel coronavirus disease (COVID-19). However, we see the postponement as a major opportunity for ASICS. The extra year gives us more time to provide even better products to athletes and to increase sales opportunities for related products.
In 2020, ASICS will do all it can to ensure the world’s top athletes remain in the best possible mental and physical shape, alleviate the concerns of everyone involved in running the Olympics and Paralympics, and help to prepare an event that as many people as possible can support loudly and proudly.
Once COVID-19 is contained, we will give our full support to people worldwide who want to make the most of outdoor exercise. We hope to foster an even broader love of sports and fully communicate ASICS’ appeal to lay the foundations for a stronger future.
Sustainability also remains a key element of how we run ASICS, and we will actively take steps to reduce our impact on the global environment. Efforts to create sustainable societies are accelerating worldwide, illustrated by the adoption of the United Nations Sustainable Development Goals (SDGs) and the Paris Agreement in 2015. To achieve sustainable growth, we have positioned sustainability as a key part of business strategy to ensure we continue to meet the expectations of shareholders and all our other stakeholders.
One way we are working to reduce environmental impact is by switching to eco-friendly paper shoppingbags. We have already started the switch, aiming to end the use of disposable plastic shopping bags in all own retail stores worldwide by the end of 2020.
In addition, we will continue to reinforce corporate governance and actively build constructive relationships with all stakeholders to increase corporate value and ensure we secure and retain the trust of shareholders and all our other stakeholders.
We have adopted a company with audit and supervisory committee corporate structure as part of moves to strengthen governance. Under the new structure, we aim to increase corporate value by enhancing management transparency, reducing the number of board members and reinforcing the board’s oversight functions. We have also clearly separated management and executive functions to speed up business management, and appointed new members to the board to increase diversity.
Going forward, we will continue to aim for corporate governance that realizes responsive, highly transparent management. To do that, we will work to upgrade management oversight and audit functions and internal control systems, rigorously enforce compliance and increase the transparency of management activities to ensure shareholder interests are reflected in how we run ASICS.
We appreciate and look forward to your continued understanding and support.
May 2020
Chairman and CEO, Representative Director
President and COO, Representative Director
