Confident Adidas reports Q1 profit leap

Frankfurt am Main (AFP) –


German sporting goods firm Adidas said Thursday efficiency savings had powered a leap in profits in the first quarter, staying confident of hitting its full-year targets as the World Cup looms.

Net profit attributable to shareholders surged 18.7 percent year-on-year, to 540 million euros ($647 million) between January and March.

Operating or underlying profit increased 17.1 percent to 746 million euros, far outpacing revenue growth of just 1.9 percent, to 5.5 billion.

"We managed to grow the bottom line significantly faster" than revenues, chief executive Kasper Rorsted highlighted, "while continuing to invest into creating brand desire."

The group added that adjusting for currency effects, sales had increased around 10 percent, powered by Adidas' fashion-oriented Originals line as well as its running, training and football segments -- the last in starker focus this year with the Russia World Cup kicking off in June.

Adidas saw especially powerful revenue growth in North America, at 21 percent, and China at 26 percent.

Growth in the Asia-Pacific regions overall and Latin America was also in the double digits.

Meanwhile western Europe added just 5.0 percent as sales fell in Russia, eastern Europe and central Asia.

Looking ahead to the full year, the group expects a roughly 10-percent increase in worldwide currency-adjusted sales, again fuelled by North America and Asia-Pacific.

As its drive to increase margins continues, Adidas aims for a faster increase in net income from continuing operations of between 13 and 17 percent, at up to 1.675 billion euros.