News Column

Adidas Posts Losses

Mar 7 2013 7:31AM

Europe's biggest sporting goods group Adidas posted Thursday a fourth-quarter loss due to writedowns resulting from its struggling Reebok brand.

Based in the southern German city of Herzogenaurach, Adidas said it booked a net loss of $353 million (272 million euros) in the three months to the end of 2012.

The group incurred a total of 265 million euros in charges for goodwill impairment during the fourth quarter, largely because of adjusted growth expectations for Reebok in the US as well as parts of Latin America and an increase in discount rates resulting from the euro crisis.

Fourth-quarter sales rose 4 per cent to 3.37 billion euros, helped along by a strong performance by the group's business in the world's leading emerging markets.

"We are well positioned to again achieve record sales in 2013," chief executive officer Herbert Hainer said.

This year "will also see a step change in the pace of operating margin expansion. And this, in turn, will lead to another year of double-digit earnings growth," he said.

Adidas sees net profit in 2013 rising to between 890 million euros and 920 million euros and expects group sales to increase at a "mid-single-digit" rate.

This follows a 29-per-cent rise in net profit last year, to 791 million euros, and an almost 12-per-cent rise in sales on the back of the European football championships and the London Olympics.

Earnings per share will rise by between 12 and 16 per cent to between 4.25 and 4.40 euros.

The company has proposed paying a dividend of 1.35 euros a share - a 35-percent increase on last year.

Source: Copyright 2013 dpa Deutsche Presse-Agentur GmbH

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