Adidas Group Sales Up 14% For 2011

Sportswear brand adidas has revealed its financial results for the first half of 2011 – with a Group revenue increase of 14%, and an increase of 10% on a currency-neutral basis in the second quarter of the year alone.

Currency-neutral revenues in Western Europe increased 5%, supported by double-digit growth at TaylorMade-adidas Golf and sales increases at adidas.

In European Emerging Markets, sales were up 21% as a result of strong increases at both adidas and Reebok.

In contrast to previous quarters, currency translation effects had a negative impact on sales in euro terms, however Group revenues grew 5% to €3.064bn (£2.67bn) in the second quarter of 2011.

Herbert Hainer, adidas Group CEO, said: ‘After outlining our strategic vision for the company through to 2015 late last year, we have wasted no time and come out of the starting blocks in typical adidas Group fashion – fast and focused’.

‘No matter which way we break down our results – by segment, by region or by brand – all facets of our business are excelling’.

The Group’s gross margin increased 0.2 percentage points to 49.2% (2010: 48.9%) in the second quarter as a larger share of higher-margin retail sales as well as a more favourable product and regional sales mix more than offset an increase in input costs.

Group gross profit increased 6% to €1.506bn (£1.312bn), while other operating expenses as a percentage of sales decreased 60 basis points to 43.3% compared to 43.9% the prior year, primarily due to lower marketing expenses.
 
Hainer added: ‘No matter which retailer I speak to, or which market share statistic I read, our product sell-throughs are stronger than they have ever been. Despite severe external pressures from currency volatility and rising commodity prices, we were able to defend our profitability as a result of our unparalleled strength in innovation and design as well as supply chain excellence’.

‘After the strong first half performance, we are on our way to record sales and earnings in 2011. This is all the more notable as various currencies have been weakening versus the euro, which negatively impacts our financial results in the short term’.