GERMANY: Adidas Q3 profit surge despite Reebok slump
- Q3 net profit up 14% to EUR344m
- Group revenues rise 11% to EUR4.17bn
- Reebok revenues plummet by 25% currency-neutral
Sporting goods powerhouse Adidas has posted double-digit increases in profit and revenues in the third quarter, despite continuing worries about its under-performing Reebok brand.
Group revenues were positively impacted by currency rates, rising only 4% on a currency-neutral basis, but driven by double-digit increases in retail.
Sustained momentum at Adidas helped revenues in Western Europe to rise 1% currency-neutral, while strong increases for both Adidas and Reebok drove a 19% revenue surge in European emerging markets.
However, North America fell 5% as increases for Adidas and TaylorMade-Adidas Golf were more than offset by strong revenue declines at Reebok.
Similarly, Greater China revenues increased 11% and other Asian markets rose 1%, as growth for Adidas was balanced by strong sales declines at Reebok.
Meanwhile, group revenues in Latin America rose 16% in the third quarter.
By brand, third quarter sales for Adidas increased 10% and TaylorMade-Adidas Golf was up 4%, but Reebok revenues slumped 25%, hit by the non-recurrence of prior-year licence sales and negative impacts from Reebok India Company.
Nonetheless, Adidas CEO Herbert Hainer was content with the company’s results, saying: “These impressive financial results reflect our relentless focus on creating the industry’s most desirable brands, which we are doing through consistent product innovation, brand authentication and investment.
“We have grown the bottom line faster than the top line now for the last seven quarters, which ensures we will deliver another year of record financial results for 2012.”
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