German sportswear manufacturer Adidas records double-digit growth in China in Q2

0 Comment(s)Print E-mail Xinhua, August 9, 2019
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BERLIN, Aug. 8 (Xinhua) -- Turnover of Adidas in China increased year-on-year by 14 percent in the second quarter of 2019 (Q2), the German sportswear manufacturer announced on Thursday.

"We delivered another successful quarter. Sales in our strategic growth areas Greater China and e-commerce continued to increase at a double-digit rate and so did our bottom line," said Kasper Rorsted, chief executive officer (CEO) of Adidas.

The company's net profits increased by 10 percent to 462 million euros (517 million U.S. dollars) in Q2, which included a "negative impact from the adoption" of the International Financial Reporting Standard 16 of 7 million euros, Adidas stated.

Group turnover of Adidas grew by 4 percent to 5.5 billion euros in Q2, "driven by sales increases in most market segments," said the company.

Sales in Adidas' domestic European market had been "flat year-over-year" while turnover in North America had increased by 6 percent.

Adidas recorded a decline in turnover in Russia as well as the region of Commonwealth of Independent States (CIS) of 4 percent, due to "difficult prior year comparisons in relation to the 2018 FIFA World Cup."

The operational profit margin of the company grew 0.4 percentage points to 11.7 percent in Q2 2019, mainly "driven" by the increased gross margin.

"Higher air freight costs to mitigate the supply chain shortages and a less favorable pricing mix were overcompensated by positive currency developments, lower sourcing costs as well as a better product and channel mix," Adidas stated.

The company confirmed its business guidance and is expecting turnover to increase between 5 percent and 8 percent on a currency-neutral basis in 2019.

Following a 4 percent growth in turnover in the first six months of 2019, Adidas is expecting a "sequential acceleration during the second half of the year." Enditem

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