Adidas 1Q Profit Rose; Guides for Higher Sales
May 07 2021 - 2:30AM
Dow Jones News
By Giulia Petroni
Adidas AG said Friday that profit rose in the first quarter as
performance improved across all market segments, and updated its
outlook for the full year, guiding for higher sales.
The German sporting-goods company said quarterly net profit was
558 million euros ($673.2 million) from EUR31 million a year
earlier.
Sales increased 20% to EUR5.27 billion, driven by solid results
in direct-to-consumer revenue and strong e-commerce.
Adidas said it now expects currency-neutral sales to increase by
around 50% in the second quarter and at a high-teens rate in
2021.
The company also backed previous guidance for the full year. Its
gross margin is expected at around 52%, while the operating margin
is expected to increase to between 9% and 10%. Net income from
continuing operations is seen at EUR1.25 billion-EUR1.45
billion.
Adidas added that its profitability outlook will temporarily
include stranded costs associated with the divestiture of Reebok.
In the full year, these costs are expected to amount to around
EUR250 million at the operating profit level and should negatively
affect net income from continuing operations by around EUR200
million, it said. Only around 30% of the EUR250 million will
reoccur in 2022, while in 2023 the stranded costs will be
eliminated.
Write to Giulia Petroni at giulia.petroni@wsj.com
(END) Dow Jones Newswires
May 07, 2021 02:15 ET (06:15 GMT)
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