Profit drop
March 3, 2010
Adidas said Wednesday that its 2009 profit plunged by 62 percent to 245 million euros ($333 million), the result of higher costs and lower demand during the economic downturn. Last year saw sales drop by 6 percent to 10.38 billion euros, down from 10.79 billion euros.
"Without a doubt, 2009 was the most difficult year during my time as chief executive," said Herbert Hainer, CEO of the Herzogenaurach-based company.
"However, we rose to the challenge. Despite a 53 percent decline in operating profit, we generated a 141 percent increase in net cash from operations for a record 1.2 billion euros," Hainer said in a report. "This is definitely the outstanding achievement of the year and a credit to all the hard work and dedication of our employees."
Hainer said Adidas was starting 2010 with renewed optimism that sales would increase, in part because of this year's soccer World Cup in South Africa.
Soccer fever to spur sales
Adidas is hoping that enthusiasm for soccer-related equipment and clothing will boost its 2010 net profit by between 400 and 450 million euros.
During the last World Cup in 2006, hosted by Germany, Adidas increased its top line by more than a billion euros. But the company isn't expecting the same level of sales at this year's tournament, as it's factoring in a slow turnaround in consumer spending in the wake of the financial crisis.
The company is likely to have a bigger profile from the event than competitors Nike and Puma, however. Adidas is supplying uniforms to 12 of the teams competing in South Africa, compared with nine teams for Nike and seven for Puma.
dc/dpa/afp
Editor: Michael Lawton