German sportswear and equipment maker Adidas said yesterday that profit last year plunged by 62 percent during one of its most difficult years, but forecast some improvement this year.
Net profit fell to 245 million euros (US$334 million), a statement said.
In the fourth quarter of the year, a traditionally weak period, net profit fell by 64 percent to 19 million euros, the company said, well below an average analyst forecast of 25 million compiled by Dow Jones Newswires.
“Without question, 2009 was the most difficult year since I became CEO of the group,” chief executive Herbert Hainer was quoted as saying, with the results demonstrating once again tough conditions faced by global retailers.
Adidas said sales this year were expected to gain between 1 percent and 6 percent however, because of the FIFA World Cup in South Africa and increasing demand in emerging markets.
Group sales, including the Adidas, Reebok, Rockport and TaylorMade-Adidas Golf brands, lost 3 percent last year to 10.381 billion euros, and fell by 5 percent in the fourth quarter to 2.458 billion euros.
Analysts had expected a slightly smaller decline in fourth quarter sales to 2.51 billion euros.
Fourth quarter operating profit came to 42 million euros, well below an analyst forecast of 67 million, and the results were also hit by higher marketing expenses in the run-up to the World Cup.
All the news was not bad however, as the group’s struggling Reebok brand managed to increase key North American sales by 4 percent in the last three months of the year.
Although Adidas expects only a slow turnaround in consumer demand this year, it said that the 2010 World Cup, “high exposure to fast-growing emerging markets” and improvements at Reebok should offset that enough to push sales up.
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