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Adidas Posts Record 2011 Profits, Expects Olympics, Soccer Boost

March 7, 2012
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The world's second-biggest sporting goods maker, Adidas, unveiled record profits for 2011 Wednesday, and said its hopes for another big boost to its business in the coming 12 months from this year's Olympics and the Euro 2012 football championships.

"There is always great buzz and excitement around major sports events and they don't come bigger than the London 2012 Olympic Games and the UEFA Euro 2012," said Adidas chief executive Herbert Hainer.

The German company said net profits rose 18.2 percent to 671 million euros ($881 million) in 2011, boosted by strong demand in North America and China -- the world's two biggest economies.

Adidas is expecting sales to climb between 5 and 9 percent this year, boosted by the Olympics, which open in London in July and the June European football championships in Poland and the Ukraine.

With Adidas the official sponsor of the football championships, the group expects sales this year from football items to surpass the record 1.5 billion euros it posted last year. Adidas also plans to be "the most visible brand" at the games in London.

The group, which forecasts net profit to rise to between 736 and 770 million euros this year, also pointed to growing demand in the world's emerging markets -- in particular China and Russia -- as helping to drive earnings in the coming 12 months.

"Despite the high degree of uncertainty regarding the global economic outlook and consumer spending, sales development will be favourably impacted by the group's high exposure to fast-growing emerging markets," the company said.

But investors appear to have been hoping that the staging of the Olympics and the euro football championships would prove to be an even bigger win for the group.

As a result, Adidas shares slumped following the release of the results. By late morning, its shares were down about 2 percent at 56.96 euros in trading in Frankfurt.

Adidas, which is the world's biggest sporting goods maker after US-based Nike, said net profit in the fourth quarter more than doubled to 18 million euros on the back of a 11.3 percent gain in sales.



Source: Copyright 2012 dpa Deutsche Presse-Agentur GmbH


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